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Panel data IV, ivreg2 and fixed effects

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Dear Statalister,

Some background:

I am currently working on an IV unbalanced panel data model. The model is estimating the effect of regulation to microfinance in a country (instrumented by a dummy variable) and regulation is also a dummy variable.

In the instrumental variables approach I estimate the following two-stage model:

= α0 + α ·dummy + θ · X + η ( Ist stage using Probit model, and then use predicted value for second stage)

Dep. Var. = β0 + β1 · + γ · X+ ε

My issue is can I make use of Ivreg2 for the second stage or xtivreg2 or Is there a user written command I can use for both stages and I need the results in fixed effects.

I am a new user of Stata and I am using Stata12.

Please kindly assist.


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