I have a balanced panel data of 12 countries (5 countries are developing and rest are advanced economies) and nine indicators. which methodology would give better results and what is the rationale of using it?
Did you really mean " which methodology would give better results "? If so, try p-fishing, looking elsewhere, exploring the garden of forked paths, etc., (i.e., try as many procedures as you want until you get "better results" (and better than what?). Better yet, just write down the numbers you want. If you didn't mean this I recommend deleting this question, and start a new question saying what criteria you would like the procedure to have, describe the study with sufficient information that a reasonable person would expect an answer, and say what you key research questions are.
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