Hello,
I have a panel database for firms i (90 firms) across year t (from 2013 to 2019). Some firms witnessed a cross border investment in a year that is between 2013 and 2019. I created a dummy=1, when the firm has received the investment in the corresponding year.
I want to create three groups small (1), medium (2) and large (3) using the revenue generated by the company and then compute how likely one firm can go from group 1 to group 2 or 3, if received foreign investment.
I am not sure which statistical method I should use and how to arrange my data according to this method.
You may want to check the following paper out:
Specialization and herding behavior of trading firms in a financial market
F Lillo, E Moro, G Vaglica… - New Journal of Physics, 2008 - iopscience.iop.org
I would have thought it would have depended on the amount of investment and what the firm did with it. Best, D. Booth
You can provide probability distributions for the probability such as normal or weibull
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