When does the "stationary" problem become and issue with panel data? I recently came by a post that states in panel data with small time dimensions the stationarity issue is not present, is this true? can anybody provide a source for this?


I'm working with a panel data set for 10 states over 11 years, with variables: unemployment, poverty rates, age controls in (%) and minimum wages.


Should I bother trying to test for unit roots? if so what tests would you recommend? I am using R and having difficulties trying to find and understand some tests used in panel data sets.

-thanks
The data sample is so small that formal testing for stationarity would be essentially worthless. Inspect visually your individual series for any obvious trend. This would be the case where even with a short sample non-stationarity would be a problem.