I'm trying to replicate output produced by the NY Federal Reserve, but am a bit confused as to how they're forecasting out of sample from a probit, and how to do so in Stata. They provide their data here. They're using a probit model and report "Probability of US Recession Predicted by Treasury Spread* Twelve Months Ahead (month averages)." There's example data below. I understand how to get predicted probabilities by using the predict command after running probit, but not the "Twelve Months Ahead ( month averages)." If anyone has any ideas how to interpret and reproduce those results I'd really appreciate it!
Code:
* Example generated by -dataex-. To install: ssc install dataex clear input int date double(tenyr threemon spread) byte nber_rec -335 4.02 2.82 1.1403059139902267 0 -307 3.96 2.7 1.2036881717723462 0 -276 3.99 2.8 1.1308748587222905 0 -246 4.12 2.95 1.106556698491949 0 -215 4.31 2.84 1.4097348744710638 0 -185 4.34 3.21 1.058792401343232 0 -154 4.4 3.2 1.129097589389731 0 -123 4.43 3.38 .9735238070156065 0 -93 4.68 4.04 .5416269031857555 0 -62 4.53 4.05 .38127745292431303 0 -32 4.53 4.15 .2777538680070233 0 -1 4.69 4.49 .08537770490126739 0 30 4.72 4.35 .26054794174274676 0 59 4.49 3.96 .4344034788230182 0 90 4.25 3.31 .8657116249598373 0 120 4.28 3.23 .978180449430587 0 151 4.35 3.29 .9863319842434066 1 181 4.15 2.46 1.6402267265277928 1 212 3.9 2.3 1.5544186059507075 1 243 3.8 2.3 1.4544186059507074 1 end format %td date
Code:
probit nber_rec spread
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