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A new condition for pooling states in multinomial logit

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  • Hong il Yoo

    ()
    (University of New South Wales)

Abstract

The Cramer-Ridder test is a popular procedure for testing if some outcome states can be pooled into one state in the multinomial logit model. We show that, in the presence of binary regressors, the test is overly stringent and poolability may not be tested unambiguously.

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File URL: http://research.economics.unsw.edu.au/RePEc/papers/2012-48.pdf
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Bibliographic Info

Paper provided by School of Economics, The University of New South Wales in its series Discussion Papers with number 2012-48.

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Length: 9 pages
Date of creation: Nov 2012
Date of revision:
Handle: RePEc:swe:wpaper:2012-48

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Keywords: multinomial logit; pooling; statistical test;

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  1. Cramer, J. S. & Ridder, G., 1991. "Pooling states in the multinomial logit model," Journal of Econometrics, Elsevier, vol. 47(2-3), pages 267-272, February.
  2. Chalkley, Martin & McVicar, Duncan, 2008. "Choice of contracts in the British National Health Service: An empirical study," Journal of Health Economics, Elsevier, vol. 27(5), pages 1155-1167, September.
  3. Diane M. Dancer & Denzil G. Fiebig, 2004. "Modelling Students at Risk," Australian Economic Papers, Wiley Blackwell, vol. 43(2), pages 158-173, 06.
  4. Anh Ngoc Nguyen & Jim Taylor, 2003. "Post-high school choices: New evidence from a multinomial logit model," Journal of Population Economics, Springer, vol. 16(2), pages 287-306, 05.
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