Re: st: Grouped Tobit

[Gordon Hughes <G.A.Hughes@ed.ac.uk>]

For those who are unfamiliar with the terminology, the term "grouped 
tobit" is used in econometrics to refer to the analysis of responses 
that are nominally cardinal - i.e. money values - but which have been 
recorded by range rather than value: e.g. 1 = 0-5, 2 = 5-10, 3 = 
10-20, etc.  The tobit reference arises by assuming that the ranges 
are censored either at the bottom or the top end.

To answer the original question: I am not aware of a user-written 
procedure that implements grouped tobit.  If you really want to do 
that, then you should probably use Limdep for the purpose as it has a 
richer range of econometric procedures for models with limited and 
dependent variables.

You should also consider whether a grouped tobit specification is 
really an improvement on, say, an ordered probit model, which is 
available in Stata via -oprobit- and other routines.  The theory is 
that grouped tobit is more efficient because you can make use of 
knowledge of the upper and lower values of each 
category/range.  However, in practical terms I am sceptical that most 
datasets with valuation ranges really embed consistent and reliable 
upper and lower values for each range.  In many circumstances it may 
be more reasonable to assume that answers are ordinal rather than cardinal.

Regards

Gordon Hughes
g.a.hughes@ed.ac.uk

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