Hi everyone,

I want to investigate the effect that Financial Knowledge (FK, mesaured as the number of correct answers to six knowledge questions; ranges from 0-6) has on a binary variable describing whether or not a person owns a retirement fund (RET: 0, if the person does not own a retirement fund; 1, if the person owns a retirement fund)

First, I estimated a usual Probit regression and calculated the marginal effects at the mean

Code:
probit RET FK (....  + 11 control variables CV1-CV11)
margins, dydx(FK) atmeans
I get a marginal effect of ~3% and a z-value of 15, which seems plausible to me.

In a next step, I want to conduct an instrumental variable probit regression and compare the results with the results above. I use the answer to the question "Were you ever required to take financial education?" (FE) as an instrument for FK and estimate marginal effects at the mean again:

Code:
cmp(RET=FK CV1-CV11) (FK=CV1-CV11 FE), ind($cmp_probit $cmp_cont)
margins, dydx(FK) atmeans
Now, I get a marginal effect of ~55% and a z-value of 10. I must have messed something up with the cmp command, since this marginal effect would tell me that someone with FK=0 has a 300% lower probability to have a retirement fund than someone with FK=6, right?

I am very much looking forward to your answers. Thanks in advance!

Best regards,

Vincent