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Submitted by Michele V on
I am wondering the following, cause I never looked at intra-cluster correlation before. The econometrics practice recommends to cluster the s.e. at the group-level as soon as my explanatory variable of interest varies only at the group level or I suspect that some relevant unobserved factor may be correlated at that level. Does the intra-cluster correlation still matter once I cluster the s.e. in my regression specification? Thanks