Re: st: Tobit interpretation and post estimation

["Elena Giarda" <elena.giarda@prometeia.it>]

Dear Maarten and Austin,

thank you for your replies, they are both very useful.

Our main aim is to estimate age profiles of household debt, by cohort, to 
follow the evolution of household debt.

We chose a tobit model because we have the problem of debt rationing: some 
households have zero debt not because they choose so, but because were 
refused the loan by banks or financial institutions. Also some households 
might have a lower level of debt than desired because of partial rationing. 
We excluded non-rationed households (with zero debt) from our sample (is 
this reasonable?) because this is their desired level of debt. We are able 
to detect rationed and non-rationed households from a couple of questions in 
the Bank of Italy's household survey. We also found reference of this 
approach in the literature, but maybe is not the most appropriate.

Anyway...we made a mistake in our first estimates, because we set the 
censoring level at zero, when instead it should be a positive number. In 
case we decide to go further with the tobit estimation how do we choose the 
level of censoring?

About the "positive debt" problem pointed out by Austin: we are using the 
variable "debt" (we have now switched  to the total amount of debt=consumer 
debt + mortgages) with the amount of debt declared by the household. We are 
not considering overal wealth of households, therefore debt is either zero 
or positive.

We'll check the suggestion by Austin about the poisson regression and will 
let you know how it goes.

Thanks again!

Elena and Cristiana
elena.giarda@prometeia.it





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