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Sample Selection Versus Two-Part Models Revisited: the Case of Female Smoking and Drinking

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  • David Madden

Abstract

There is a well-established debate between Heckman sample selection and two-part models in health econometrics, particularly when no obvious exclusion restrictions are available. Most of this debate has focussed on the application of these models to health care expenditure. This paper revisits the debate in the context of female smoking and drinking, and evaluates the two approaches on three grounds: theoretical, practical and statistical. The two-part model is generally favoured but it is stressed that this comparison should be carried out on a case-by-case basis.

Suggested Citation

  • David Madden, 2006. "Sample Selection Versus Two-Part Models Revisited: the Case of Female Smoking and Drinking," Health, Econometrics and Data Group (HEDG) Working Papers 06/12, HEDG, c/o Department of Economics, University of York.
  • Handle: RePEc:yor:hectdg:06/12
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    References listed on IDEAS

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    1. James J. Heckman, 1976. "The Common Structure of Statistical Models of Truncation, Sample Selection and Limited Dependent Variables and a Simple Estimator for Such Models," NBER Chapters, in: Annals of Economic and Social Measurement, Volume 5, number 4, pages 475-492, National Bureau of Economic Research, Inc.
    2. Cragg, John G, 1971. "Some Statistical Models for Limited Dependent Variables with Application to the Demand for Durable Goods," Econometrica, Econometric Society, vol. 39(5), pages 829-844, September.
    3. Leung, Siu Fai & Yu, Shihti, 1996. "On the choice between sample selection and two-part models," Journal of Econometrics, Elsevier, vol. 72(1-2), pages 197-229.
    4. Duan, Naihua, et al, 1984. "Choosing between the Sample-Selection Model and the Multi-part Model," Journal of Business & Economic Statistics, American Statistical Association, vol. 2(3), pages 283-289, July.
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    6. Sandra L. Decker & Amy Ellen Schwartz, 2000. "Cigarettes and Alcohol: Substitutes or Complements?," NBER Working Papers 7535, National Bureau of Economic Research, Inc.
    7. Meena Seshamani & Alastair Gray, 2004. "Ageing and health‐care expenditure: the red herring argument revisited," Health Economics, John Wiley & Sons, Ltd., vol. 13(4), pages 303-314, April.
    8. Patrick Puhani, 2000. "The Heckman Correction for Sample Selection and Its Critique," Journal of Economic Surveys, Wiley Blackwell, vol. 14(1), pages 53-68, February.
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    11. Willard G. Manning Jr. & Charles E. Phelps, 1979. "The Demand for Dental Care," Bell Journal of Economics, The RAND Corporation, vol. 10(2), pages 503-525, Autumn.
    12. Jones, Andrew M, 1989. "A Double-Hurdle Model of Cigarette Consumption," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 4(1), pages 23-39, Jan.-Mar..
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    More about this item

    Keywords

    Selection; Two-part; Smoking; Drinking;
    All these keywords.

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models; Threshold Regression Models
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities

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