I'm working with a longitudinal panel dataset that surveys the same few thousand individuals biennially and I have six years of this data. My dependent variable would be how much individuals spend on X, and there are a list of about 15 independent variables such as age, income, etc that could affect whether and how much individuals spend on X.
I could run regressions for each panel to see whether people who have higher incomes spend more on X, for example, but I want to be able to measure whether the spending patterns of individuals on X changes as their circumstances change (do individuals who get a raise between surveys spend more on X? do individuals spend more on X as they get older?) instead of just whether richer individuals spend more on X. I have no idea how to go about this, though.
What I have so far is that I could difference the data between years so I have (for example) IncomeChange and SpendingOnX for every year, and so on and combine everything as a set of entries, but that doesn't measure individual behavior changes as much as just the effect of changes. Such as:
..... | IncomeChange & all indep vars | dSpendingOnX
...1 | [2007 to 2005 for individual A].. | [how much more A spent in 2007]
...2 | [2009 to 2007 for individual A].. | [how much more A spent in 2009]
...3 | [2007 to 2005 for individual B].. | [how much more B spent in 2007]
...4 | [2009 to 2007 for individual B].. | [how much more B spent in 2009]
...5 | [2011 to 2009 for individual A].. | [how much more A spent in 2011]
And so on, down to entry 25,000 (for the same 5000 people surveyed each of the years, for 5 years since differencing wouldn't be available for the first year of the survey).
That would let me see how changes in, say, income, affect changes in spending in general, but I feel like there would be methods that would be a lot more insightful and I just haven't been able to figure them out. Would I have to run a separate regression for each year-combo (one for 2007 with differences in variables since 2005, one for 2009 with differences in variables since 2007, and so on?)
For example, with this level of information:
UserID | dIncome05to07 | dIncome07to09 | dIncome09to11 | dSpending05to07 | dSpending07to09 | dSpending09to11
A | +1000 | -3000 | +250 | +100 | -200 | +100
B | +2000 | -5000 | +700 | +400 | -100 | +100
...all the way down to the 5000th individual.
How would I be able to find results in the format of something like: "in general, as individuals see a change in income of +1000 the amount they spend on X is expected to change by +117.42"? Or is that not possible with this set of longitudinal panel data? With 5000 individuals, it's not like I could add, say, a dummy for each individual or something (to my knowledge) or subset them into subgroups.