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st: using treatment and selection models for my data

From   "Shehzad Ali" <>
To   <>
Subject   st: using treatment and selection models for my data
Date   Sun, 11 Nov 2007 19:14:03 -0000

Hello listers,

I have a query about using biprobit, treatreg and heckman steps in stata and
generating IMRs. I am using a three-part model for medical expenditure.
Here is a summary:

I have 1,500 in the sample who felt sick, of which 1,000 sought medical
advice and hence had medical expenditure. Here the first selection bias is
regards to seeking treatment when ill. Then in the sample, 700 individuals
are insured and 1,300 are not. This is the second selection bias which is
related to insurance purchasing decision. So I need to take into account two
selection equations for my medical expenditure (outcome) equation, i.e.
sought medical advice when ill, and bought insurance. I have to bear in mind
that insurance decision also affects decision to seeking care when ill and
medical expenditure when treatment is sought.

Here is what I am thinking of doing:

First part of the model:

biprobit (eq1: visit_when_ill = insurance x1 x2 x3) (eq 2: insurance=x1 x2
x3 x4)

Here first eq is for decision to seek care when ill and second decision is
to buy insurance.

Predict imr1, xb

Second part:

heckman med_expenditure x1 x2 x3 imr1 insurance, treat(insurance= x1 x2 x3

predict imr2,xb

Third part:

treatreg med_expenditure x1 x2 x3 insurance imr2, treat(insurance=x1 x2 x3

Is this the right approach to take? Any help would be greatly appreciated.

With sincere thanks,


Shehzad I Ali
Department of Social Policy & Social Work
University of York
YO10 5NG

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