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Re: st: Heckman comand sample issue

From   "Mark Schaffer" <>
Subject   Re: st: Heckman comand sample issue
Date   Tue, 20 Apr 2004 16:16:44 +0100


From:           	"Nicolas Theopold" <>
To:             	<>
Subject:        	st: Heckman comand sample issue
Date sent:      	Tue, 20 Apr 2004 10:45:53 +0100
Send reply to:

> Dear Statalist users,
> please excuse if this is a basic question, however, I could not find the
> answer or the right search terms to find it in the archives.
> I have a data set with about 600,000 observations, of which about 90,000
> are wage earners. In it, I would like to run the heckman command to
> correct for sample selectivity bias. My earnings variable is ln(wages),
> and thus has missing values for all observations that do not have a
> recorded wage.

I don't see why this should be a problem.  According to -help heckman-

>     By default, heckman will assume that missing values (see help
>     missing) of depvar imply that the dependent variable is unobserved
>     (not selected).  With some datasets it is more convenient to
>     specify a binary variable (depvar_s) that identifies the
>     observations for which the dependent is observed/selected
>     (depvar_s!=0) or not observed (depvar_s==0); heckman will
>     accommodate either type of data.

so you shouldn't be having any problems.  -heckman- should understand 
that in your case, a missing value for ln(wages) means "not 
selected".  Or am I missing something?


> Hence, if I run my heckman with:
> Heckman ln_wages varlist1, sel(ilf = varlist1 varlist2), 
> where varlist2 are my exclusion restrictions and ilf is a participation
> dummy, the number of observations comes down to 90,000 (ilf does not
> only take the value of 1, since I failed to clean the data completely,
> yet).
> My aim is to run the selection function on the whole sample (of 600,000
> obs), and to get stata to run the wage function without the missing
> observations. The only solution I found was to replace all missing
> values with -9999 in ln_wages.
> Is there some better way to tell stata to use the whole sample for the
> selection function, even if ln_wages is missing?
> Thank you very much in advance for your help.
> Nicolas
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Prof. Mark E. Schaffer
Centre for Economic Reform and Transformation
Department of Economics
School of Management & Languages
Heriot-Watt University, Edinburgh EH14 4AS  UK
44-131-451-3494 direct
44-131-451-3008 fax
44-131-451-3485 CERT administrator
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