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st: Re: STATA and GREEN


From   "Eric W. Welch" <ewwelch@uic.edu>
To   statalist@hsphsun2.harvard.edu
Subject   st: Re: STATA and GREEN
Date   Thu, 20 Mar 2008 17:53:38 -0500


> --------------------------------------------------
> We would like to estimate either a fixed effect or random effect model in which 2 explanatory variables are binary choice, dummy variables.  For each there are issues of self-selection bias for which we have the following solution.
>
> (1)We apply bivariate probit model to these 2 binary choices.
> (2)Using the estimation results, we calculate the predicted probability
> of each variable.
> (3)Using these predicted probabilities, we estimate the 2nd stage model.
>
>  We have the following questions:
> (1) Is this an appropriate strategy for a model with this type of structure? ie. the error terms of the equations for the binary choice models are correlated and the error terms of the binary choice models and the 2nd stage model are correlated.
>   
> (2) If NO, what is an appropirate strategy and how should it be modeled in STATA? Are there any good examples, articles or other sources that we can refer to?
>   
> (3)If YES, is it possible to calculate the separate predicted probabilities to
> replace the 2 dummy variables in the second stage.
>
> -----------------------------------------------------
>
>
>   

-- 

Eric W. Welch

Associate Professor

Public Administration

University of Illinois at Chicago

http://www.uic.edu/orgs/stresearch

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