I am interested in how the characteristics of policy i and the characteristics of insurance j influence the probability that insurance j is chosen as a participant on policy i. The standard multinomial choice model as McFadden’s choice model isn't the correct one because there aren't only x potential outcomes and one is chosen. Instead, here there are x potential outcomes and any number of them can be chosen.
I think a maximum likelihood probit estimation in a setting in which multiple outcomes can be simultaneously chosen would be the correct one.
One critical component of the analysis is the correlation structure of the error terms within a choice set. In particular, I would allow the errors to be freely correlated across all potential participants on any policy by a given policy holder. Some policy holder has more than one policy, and I allow errors to be correlated for all potential participants on any of the policies.
Code:
ssc install dataex
clear
input byte policy str6 Holder str9 insurance byte choice
1 "Jeff" "Health" 1
2 "Chris" "Mediocre" 1
3 "Jamie" "Health" 1
3 "Jamie" "AB" 1
3 "Jamie" "Medical" 1
4 "Mela" "Obamacare" 1
end
tempfile a
save `a'
expand 2
replace policy = -1 if _n >_N/2
fillin policy insurance
replace choice = 0 if choice ==.
joinby policy using `a', update
duplicates drop policy Holder insurance choice, force
Output:
policy Holder insurance choice
1 Jeff AB 0
1 Jeff Health 1
1 Jeff Medical 0
1 Jeff Mediocre 0
1 Jeff Obamacare 0
2 Chris AB 0
2 Chris Health 0
2 Chris Medical 0
2 Chris Mediocre 1
2 Chris Obamacare 0
3 Jamie AB 1
3 Jamie Health 1
3 Jamie Medical 1
3 Jamie Mediocre 0
3 Jamie Obamacare 0
4 Mela AB 0
4 Mela Health 0
4 Mela Medical 0
4 Mela Mediocre 0
4 Mela Obamacare 1
Probit-Estimation (first try):
meprobit choice, vce(cluster Holder) nogroup
margins, dydx(*)
--> But how can I compute my probit estimation with multiple simultaneous chosen insurances in Stata? Any thoughts are highly welcome.
Related Posts with Maximum likelihood probit estimation (multiple outcomes)
Why are Frames UsefulPerhaps this is a question for another forum, but I had a more general question about dataframes. I…
Number of splitvoters from two variablesI need to know the number of split voters in Denmark - those who did not vote for the same party at …
converting dates (year and month)Dear All, Is there a more concise way to go from date to newdate below? Thanks. Code: * Example gen…
alternative to keep if for a large list of firm id sHi all, I have a list of firm ids that contains 17,000 firm ids. I have a big dataset which contain…
Panel data estimatioinHello. Need help with panel data estimation. I am working on panel data with T=96 and N=260. I used …
Subscribe to:
Post Comments (Atom)
0 Response to Maximum likelihood probit estimation (multiple outcomes)
Post a Comment