I have a question about how to interpret the marginal effects in a probit model that I hope someone can help me with. Take a model that looks at school dropout (dependent variable =1 if dropped out, 0 otherwise) and household asset loss (independent variable ranging from 0 to 1, indicating the proportion of assets lost in the past year due to earthquake).
Code:
. probit dropout assetloss
dropout Coef. Std. Err. z P>z [95% Conf. Interval]
assetloss .491884 .0888692 5.53 0.000 .3177036 .6660644
_cons -1.493199 .0399956 -37.33 0.000 -1.571589 -1.414809
Code:
margins, dydx(assetloss) predict(pr) post
Average marginal effects Number of obs = 2,879
Model VCE : OIM
Expression : Pr(enrolled), predict(pr)
dy/dx w.r.t. : assetloss
Delta-method
dy/dx Std. Err. z P>z [95% Conf. Interval]
assetloss .0736991 .0134485 5.48 0.000 .0473406 .1000576
Is it correct to interpret the marginal effects as follows: As asset losses increased by 100 per cent, the average marginal effect on the probability of dropping out of school increased by 0.073 percentage points?
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