I have a question on using the heckman command in STATA.
My original dependent variable was left-censored at zero, but since I had to
take logs, I did a monotonic transformation of the dependent variable (y+1),
and then took logs of that [ln(y+1)]. So, my current dependent variable has
many zeroes; the rest are positive values.
1) Somehow, when I run the full MLE heckman model:
heckman y x1 x2 x3, select (x1 x2 x3)
or even when I create a dummy variable (ydummy) for my y variable, so it's 0
for when ln(y+1)=0 and 1 when ln(y+1)>0, and run
heckman y x1 x2 x3, select (ydummy = x1 x2 x3)
I get the following error:
Dependent variable never censored due to selection:
model would simplify to OLS regression
What could this mean? Is it something about my dependent variable that is
not allowing this command to proceed?
