I am wondering if we can use the firm and industry fixed effects together in a regression (panel data).
In particular, in a regression, whether we should use such a code in STATA
reghdfe y x, a( firm industry)
where firm is the variable of firms and industry is the variable standing for industries.
I think we can use both fixed effects because it is like we control for the variables at firm and industry-levels that have not yet been in the equation. However, oppositely, I wonder if the industry fixed effect is redundant here because it may be overlapped by the firm fixed effects?