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Re: st: Ordered Logit - Should I use it or not


From   Christoph Engel <engel@coll.mpg.de>
To   statalist@hsphsun2.harvard.edu
Subject   Re: st: Ordered Logit - Should I use it or not
Date   Sat, 14 Jul 2012 18:26:45 +0200

Augusto,

There would be nothing wrong with using ordered logit. If you do, you loose information though. You know how far each step is different from the next, and you know that the final step is different by two steps of 2.5 from the previous. Given this final feature of your data, OLS may eventually be better (and many would accept it with a variable of 6 expressions). If you want to be more scrupulous, you might also run an interval regression

intreg

This regression exploits the information about the fact that the distance from 0 to 2.5 is the same as the distance from 2.5 to 5, and so forth. As for the syntax, you must generate a lower level, e.g.

gen low = dv - 1.25

and an upper level

gen high = dv + 1.25

and would then run

intreg low high ivs

Hope this helps

Christoph Engel

Am 7/14/2012 4:41 PM, schrieb Augusto Pallavicini:
Hi all,
I wanted to know whether I should use ordered logit. I am working on a contingent valuation dissertation. My dependent variable is willingness to pay and contains the values 0; 2.5; 5; 7.5; 10; 15.
I transformed these values into 6 categories 1 2 3 4 5 6
The original question from which I obtained the data was Would you willing to pay 2.5 pounds for...? If yes, would you willing to pay 5...? and so on
If I cannot use ordered logit, what do you recommend me to use?
Thanks a lot
Augusto
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_________________________________________________________________
Prof. Dr. Christoph Engel
Max-Planck-Institut zur
Erforschung von Gemeinschaftsgütern
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