Stata The Stata listserver
[Date Prev][Date Next][Thread Prev][Thread Next][Date index][Thread index]

Re: st: logY, Tobit and the prediction of Y


From   Christer.Thrane@hil.no
To   statalist@hsphsun2.harvard.edu
Subject   Re: st: logY, Tobit and the prediction of Y
Date   Wed, 23 Apr 2003 15:16:43 +0200

To my question below, Mathew Stalker replied:

The prediction of Y from your model would simply be the exponential of the
predicted logY.

---

My reply: Well, according to Wooldridge, in his book Basic Econometrics
(2000:202), this does not work, since the value of Y will be systematically
underestimated by simply taking the exponential of logY.
---

However, you should note that the log of zero is minus infinity, so in your
log model no observations where Y is zero will be included.  Is this really
what you want?

---

My reply: I solved this by setting 0 expenditures to 1 befor the log
transformatiom (as I wrote in the mail).

---

Christer




                                                                                                                                               
                      mathew.stalker@dotecon.co                                                                                                
                      m                                To:       statalist@hsphsun2.harvard.edu                                                
                      Sent by:                         cc:                                                                                     
                      owner-statalist@hsphsun2.        Subject:  Re: st: logY, Tobit and the prediction of Y                                   
                      harvard.edu                                                                                                              
                                                                                                                                               
                                                                                                                                               
                      23.04.03 15:02                                                                                                           
                      Please respond to                                                                                                        
                      statalist                                                                                                                
                                                                                                                                               
                                                                                                                                               










owner-statalist@hsphsun2.harvard.edu wrote on 23/04/2003 13:18:03:

> Hi,
>
> My initial model is:
>
> Y = a + b1x1 + controls + e
>
> where Y is expenditures on a commodity and x1 is income.
>
> Since there are a lot of zeroes, I use the Tobit apporach. However, since
> the log-linear model performed better than the linear, I use the former
> (Before the log transformation of Y, I follow convention and set zeroes
to
> 1.)
>
> Accordingly, the estimated Tobit model is:
>
> logY = a + b1x1 + controls + e
>
> The problem:
>
> I want to predict the value of Y (not logY) for certain values of income
> (and put it in a graph); that is, both the conditional Y (i.e. the Y
given
> that the threshold value of 0 was passed) and the unconditional (latent)
> value of Y.
>
> Does anyone know how to do this?
>
> Best regards,
>
> Christer Thrane
> Lillehammer University College
> Norway
>
>
>
>
>
> *
> *   For searches and help try:
> *   http://www.stata.com/support/faqs/res/findit.html
> *   http://www.stata.com/support/statalist/faq
> *   http://www.ats.ucla.edu/stat/stata/



*
*   For searches and help try:
*   http://www.stata.com/support/faqs/res/findit.html
*   http://www.stata.com/support/statalist/faq
 *   http://www.ats.ucla.edu/stat/stata/




*
*   For searches and help try:
*   http://www.stata.com/support/faqs/res/findit.html
*   http://www.stata.com/support/statalist/faq
*   http://www.ats.ucla.edu/stat/stata/



© Copyright 1996–2014 StataCorp LP   |   Terms of use   |   Privacy   |   Contact us   |   What's new   |   Site index