Eviews illustrated (for version 8), chapter 11, unclear

[dancker]

Dear sir/madam,

In chapter 11 of the Eviews Illustrated (for version 8 ) I spotted something that questions me..

Within chapter 11 there is a part called 'panel estimation' where a simple regression is done. In the regression output a DW-statistic of 0.102652 is shown and it is noted (in the pink part called 'econometric digression', that this is 'funky' and a clear sign of serious serial correlation. It is said to hint that specific country information has been left out. The chapter then continues by introducing the fixed effect method to include a separate intercept for each country. In the next picture of regression output the DW-statistic has become 0.080780 and would thus (to my logic) say that there is even more serial correlation. The way this part of the chapter has been written evokes the following question for me:

Question; Does applying the fixed effect method solve the serial correlation and should the DW-statistic in the fixed effect method regression output be disregarded?

If yes, this would be great.
If no, there is no further explanation given on how to correct for this serious serial correlation as chapter 13 doesn't mention panel data methods. Where can I find info on this then?

Hope someone can help me out here..