I am working on a first-difference (FD) estimator for panel data (only two time periods). I calculated manually the first difference of each variable (dependent and two regressors) and then run an OLS on the first-differenced model: mydata $l_y y, -1) mydata $l_x1 x1, -1) mydata $l_x2 x2, -1) mydata $delta_y y - mydata $l_y mydata$ delta_x1 $x1 - mydata$ l_x1 mydata $delta_x2 x2 - mydata$l_x2 fd1 Then I run the FD estimation from the plm package on R but got completely different results: fd2 I am struggling to understand why the estimates are different. Any tips would be much appreciated.

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