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From |
Austin Nichols <austinnichols@gmail.com> |

To |
statalist@hsphsun2.harvard.edu |

Subject |
Re: st: OLS and IV have opposite sign |

Date |
Mon, 15 Oct 2012 17:20:43 -0400 |

Shikha Sinha <shikha.sinha414@gmail.com>: Sorry--I read your post a bit too quick--you are using the gender of firstborn, not genders of first 2 kids, so http://elsa.berkeley.edu/~moretti/sons.pdf is the relevant inspiration. Are you limiting to married/cohab women? If not, then an increase in number of children "caused" by the chance birth of a daughter instead of a son might be also be predictive of single motherhood, which might be correlated with increased work. I guess we need more information about your data and research question to interpret your findings for you... On Mon, Oct 15, 2012 at 5:14 PM, Austin Nichols <austinnichols@gmail.com> wrote: > Shikha Sinha <shikha.sinha414@gmail.com> > I recommend you practice using the data from the paper that pioneered > the approach: > http://economics.mit.edu/faculty/angrist/data1/data/angev98 > > My guess is that your sample size is too small for IV's consistency to > manifest itself, and you are understating your SEs. Perhaps you have > a positive point estimate whose confidence interval includes a very > wide range of negative effects? > > The usual story is that the apparent negative impact of a birth on > labor supply is biased upward in magnitude (down on the number line) > by selection; those who are intrinsically less likely to work are more > likely to give birth. So the true effect, while negative, is smaller > in magnitude than the biased OLS coef. This need not be true in every > context, of course, but I find your estimate of a positive impact of > childbirth on probability of work by mother implausible on its face. > > On Mon, Oct 15, 2012 at 4:32 PM, Shikha Sinha <shikha.sinha414@gmail.com> wrote: >> I am estimating the effect of family size (no of children) on >> probability of work by mother. The endogenous variable is no of >> children and I instrument this by gender of first born. If the first >> child is female then family size should be greater. >> >> I understand that IV correct the bias and OLS coeff may be upward or >> downward biased. One can sign the bias (+) or (-) by examining the >> correlation between the omited variable and endogenous, but What I do >> not understand why the sign would change and what determines the >> opposite sign. I get a negative OLS while a positive IV coeff. >> >> Thanks, >> Shikha >> >> On Mon, Oct 15, 2012 at 1:11 PM, Austin Nichols <austinnichols@gmail.com> wrote: >>> Shikha Sinha <shikha.sinha414@gmail.com>: >>> The econometric reason is simple if you believe the exclusion >>> restriction. Tell us what the endog var is, what the excluded >>> instruments are, and someone on the list will provide a (verbal) >>> description of the bias producing a negative OLS coef estimate >>> (evidently no longer visible in the consistent IV estimate). Then >>> someone else will weigh in on whether the exclusion restriction makes >>> sense, probably... >>> >>> On Mon, Oct 15, 2012 at 3:58 PM, Shikha Sinha <shikha.sinha414@gmail.com> wrote: >>>> Dear all, >>>> >>>> I am estimating an Ordinary least square (OLS) and Instrument variable >>>> (IV) model, however the signs are opposite to each other. The OLS >>>> coeff is negative, while the IV coeff is positive. Could anyone >>>> explain what the signs in these two models are different- is there any >>>> econometric reason for this? * * For searches and help try: * http://www.stata.com/help.cgi?search * http://www.stata.com/support/faqs/resources/statalist-faq/ * http://www.ats.ucla.edu/stat/stata/

**References**:**st: OLS and IV have opposite sign***From:*Shikha Sinha <shikha.sinha414@gmail.com>

**Re: st: OLS and IV have opposite sign***From:*Austin Nichols <austinnichols@gmail.com>

**Re: st: OLS and IV have opposite sign***From:*Shikha Sinha <shikha.sinha414@gmail.com>

**Re: st: OLS and IV have opposite sign***From:*Austin Nichols <austinnichols@gmail.com>

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