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st: heckman with panel
Dear all,
does anyone know how to estimate an endogenous switching regression with panel data in stata?
I have a 2 year panel, in which the dependent variable is the rate of growth of consumption between t and t+1, and the explanatory variables are the variance of consumption growth, the change in family size, and some demographics. In the selection equation the dependent variable is a dummy which takes value 1 if the household was liquidity constrained at time t, 0 otherwise.
I was trying to first estimate with xtprobit the probability of being constrained, then calculating the inverse of mill's ratio, and then estimate the rate of growth of consumption using a random effect regression in which I add the inverse of mill ratio.
Is it correct?
I really appreciate your help,
sincerely,
manuela
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