An outlier can be understood as an atypical observation that appears to be derived from some distribution other than the one of interest
An outlier is an observation that is numerically distant from the rest of the data , or appears to deviate markedly from other members of the sample in which it occurs
Naive interpretation of statistics derived from data sets that include outliers may be misleading
Spatial-temporal regression methods are used in geospatial analysis, meteorology, soil chemistry, and other fields to capture this systematic variation
Use the residuals from the first stage regression
Take advantage of spatial and temporal patterns in the residuals from the first stage regression
Run a local fixed effects regression with weights on the data for each country-year regression
Smooth the residual differences over countries and across time
Add in these smoothed differences to the predicted trend from step 1
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