Dear Statalisters
I have estimated 2SLS regressions. The data is
cross-section and the endogenous explanatory variable
is binary, I have used
. probit x x1 x2 x3 z
where x = endogen. binary rhs variable
I then took the predicted values and ran an -ivreg-
with the predicted values. I find that the coefficient
of the endogenous variable is 1.05 and is significant.
I guess I could scale the endogenous variable without
scaling anything as yet. I did this and I find the
coefficient of the endogenous variable is now 0.105
and has the same significance, that is, it is
significant. But I am not certain, if would be
correct.
I would be grateful, if anyone would let me know just
scaling the endogenous variable is sufficient. I am
not certain if I should scale the dependent variable
of the ivreg and also the instrument I used in the
first stage regression and the predicted values if
this is possible.
Thank you
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