Endogenous Treatment Effects for Count Data Models with Sample Selection or Endogenous Participation
AbstractIn this paper we propose an estimator for models in which an endogenous dichotomous treatment affects a count outcome in the presence of either sample selection or endogenous participation using maximum simulated likelihood. We allow for the treatment to have an effect on both the sample selection or the participation rule and the main outcome. Applications of this model are frequent in – but are not limited to – health economics. We show an application of the model using data from Kenkel and Terza (2001), who investigate the effect of physician advice on the amount of alcohol consumption. Our estimates suggest that in these data (i) neglecting treatment endogeneity leads to a wrongly signed effect of physician advice on drinking intensity, (ii) neglecting endogenous participation leads to an upward biased estimate of the treatment effect of physician advice on drinking intensity.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5372.
Length: 30 pages
Date of creation: Dec 2010
Date of revision:
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Other versions of this item:
- Bratti, M.; & Miranda, A;, 2010. "Endogenous Treatment Effects for Count Data Models with Sample Selection or Endogenous Participation," Health, Econometrics and Data Group (HEDG) Working Papers 10/19, HEDG, c/o Department of Economics, University of York.
- Massimiliano Bratti & Alfonso Miranda, 2010. "Endogenous Treatment Effects for Count Data Models with Sample Selection or Endogenous Participation," DoQSS Working Papers 10-05, Department of Quantitative Social Science - Institute of Education, University of London, revised 10 Dec 2010.
- C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
- I12 - Health, Education, and Welfare - - Health - - - Health Production
- I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-01-03 (All new papers)
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