As -h lrtest- says: " lrtest performs a likelihood-ratio test for the null
hypothesis that the parameter vector of a statistical model satisfies some
smooth constraint." The null is clearly rejected in your case so there is no
support for the restricted (nested) model B...
HTH
Martin
-----Original Message-----
From: [email protected]
[mailto:[email protected]] On Behalf Of Monika Baron
Sent: Tuesday, September 16, 2008 3:20 PM
To: [email protected]
Subject: st: Likelihood-ratio test for frontier models
Hello everyone!
I'm modelling a Stochastic Cost Frontier with the command frontier.
I'm trying to find the model's best functional form by using a
Likelihood-ratio test.
My output:
********
. lrtest A B, stats
Likelihood-ratio test LR chi2(6) =
49.42
(Assumption: B nested in A) Prob > chi2 =
0.0000
----------------------------------------------------------------------------
-
Model | Obs ll(null) ll(model) df AIC BIC
-------------+--------------------------------------------------------------
-
B | 439 . 548.5923 17 -1063.185 -993.748
A | 439 . 573.3007 23 -1100.601 -1006.658
----------------------------------------------------------------------------
-
Note: N=Obs used in calculating BIC; see [R] BIC note
*********
1. Why are there no ll(null) in the statistics?
2. What do the results imply? Which model should I choose?
Thanks
Monika
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