Dear all,
I want to generate random numbers to add to the linear
index of a probit model (xb) so that I can predict
precisely the 1/0 observed outcomes.
Therefore, for y=1 I want to draw a random number
(vi)from a N~(0,1) so that xb+v>0 and for y=0 I want
to draw a random number (vi) so that xb+v<=0. Any idea
on how I can draw these numbers and add them to the
index in few steps?
Best wishes
Fabio
I'm not clear how random numbers could do this. In order for xb+v>0| y=1,
the lower bound of v has to be -xb. I suppose you could set v to the max
of -xb and some random number, but then you are not really adding random
numbers anymore. Or perhaps you shift your random variable so its lower
bound is -xb (if y = 1) or its upper bound is -xb (if y = 0). Something
like this after a probit would do that (this may need a little tweaking):
