Dear Stata Community,
I would like to ask if anyone here could offer some advice on the estimation that I would like to do. I am using Stata v14, and am trying to specify my identification strategy before getting started. This isn't a straight-forward linear analysis, so I am struggling conceptually. I would like to estimate the following:
prices = a + b store_type + b age + b vector of control variables + et
prices = continuous
store_type = binary
age = continuous
distance = ordinal
store_type is endogenous to prices. I am therefore using an instrument (distance, which is measured in time, as: 1=0-30 minutes, 2=30 inutes, 3=30-60 minutes).
1. In my first-stage regression, can I use an ordinal variable to predict a binary variable?
a. My instrument is ordinal, but the distance between each measure is not equal
b. My instrument is left-skewed, 60% responded 1
Would I then need to use a tobit model?
2. In my second-stage regression, is it okay to use, for example, the predictions from a probit or tobit model in a linear model? I've read on this forum that Wooldridge (2002), pages 623-625 says that this is possible, but is it true given (#1 a. and b.)?
3. My two main variables of interest on the right-hand side are store_type and age. I want to keep age but it correlates with store_type. Is there a common way to break this collinearity (besides centering/demeaning)?
MANY thanks in advance for any helpful tips.
MT
Related Posts with Running IV with ordinal instrument on binary endogenous independent variable and continuous outcome variable
multiple random sample from a dataI created a data with 100,000 obs with uniform distribution and also created information for educati…
Merging two datasets to calculate an amount of days between two datesDear Statalisters, I'd like my data to be confidential so please forgive me if I remain vague durin…
How to reshape/convert a household data set in the wide format to long formatHi family, I have a data set that the individual household member's information is presented in the …
Loop for variable creationHi, Following is snapshot of the data Below is the dataex of what I currently have Code: * Exampl…
Stata local macros not displayingHello, I am trying to rescale weights within a single NSFG survey wave to have a mean of 1, however …
Subscribe to:
Post Comments (Atom)
0 Response to Running IV with ordinal instrument on binary endogenous independent variable and continuous outcome variable
Post a Comment