st: xtmixed and time varying level 1 fixed effects

[Christoph Wunder <christoph.wunder@sowi.uni-bamberg.de>]

Dear Statalist,

I am dealing with a two level random intercept model. I use panel data
with (repeated) observations nested in individuals (level 2) nested in
households (level 1). Consequently, the model can be specified as

y_hit = x_hit * b0 + n_hit

where y_hit denotes the observation for individual i in household h at
time t; n is the nested error component (n_hit = u_h + v_hi + e_hit). I
estimate this model using

xtmixed y x || level1: || level2:

So far, the procedure seems to be straight forward. In a second step, 
however, time varying and household specific variables enter the model.

y_hit = x_hit * b0 + z_ht * b1 + n_hit

Question: How can I control for the fact that individuals living in the
same household share the same household characteristics at time t? Or
can z_ht be treated as a household fixed effect (i.e. is the estimation
identical to a model containing z_h)?

Thanks,
Christoph
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