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From |
"Alexandre, Pierre K" <PAlexand@med.miami.edu> |

To |
"'statalist@hsphsun2.harvard.edu'" <statalist@hsphsun2.harvard.edu> |

Subject |
RE: st: logY, Tobit and the prediction of Y |

Date |
Wed, 23 Apr 2003 09:27:24 -0400 |

The literature on two-part model may be helpful. Manning (1998) Journal of Health Economics, Manning et al (1987) Journal of Econometrics, Andersen et al. (2000) Health Economics may be useful. Pierre K. Alexandre, Ph.D., M.S. Assistant Professor of Health Economics University of Miami - School of Medicine Dept of Epidemiology and Public Health 1801 NW 9 Avenue, Suite 328 Miami, Florida 33136 Tel. 305-243-3482; Fax: 305-243-6436 -----Original Message----- From: Christer.Thrane@hil.no [mailto:Christer.Thrane@hil.no] Sent: Wednesday, April 23, 2003 9:17 AM To: statalist@hsphsun2.harvard.edu Subject: Re: st: logY, Tobit and the prediction of Y 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/ * * 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/

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