st: Why do i get different results with year robust clusters vs year dummies

[Haillie Lee <nal@princeton.edu>]

Dear List,

Because I am relatively new to stata, I decide to resort to the power
of collective wisdom. I am studying the relationship between political
tension(IV) and export (DV) but I am confused because i am getting
different results based on my model specification. I am using areg and
when I specify model as areg export political tension ( list of
control variables), robust cluster(year) absorb(country) I find my
coefficient to be significant. However, when I specifiy it with year
dummies as areg export political tension (list of control variables)
y1990 y1991 y1992......., absorb(country), my coefficient turns
insignificant. Can someone help me why I see this inconsistency and
let me know if one model is better than the other? I mean, what I
observe seems counterintuitive because the results should be the same
given that I am controlling for the year effect in both
specifications.

Thank you very much and I look forward to hearing from you soon.

Sincerely,
Haillie
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