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# Empirical Methods for Microeconomic Applications - PowerPoint PPT Presentation

Empirical Methods for Microeconomic Applications. William Greene Department of Economics Stern School of Business. Upload Your Project File. Commands for Random Parameters. Random Parameter Specifications.

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Empirical Methods for Microeconomic Applications

William Greene

Department of Economics

All models in LIMDEP/NLOGIT may be fit with random parameters, with panel or cross sections. NLOGIT has more options (not shown here) than the more general cases.

Options for specifications

; FCN = name ( type ), name ( type ), …

Type is N = normal,

U = uniform,

L = lognormal (positive),

T = tent shaped distributions.

C = nonrandom (variance = 0 – only in NLOGIT)

Name is the name of a variable or parameter in the model orA_choice for ASCs (up to 8 characters). In the CLOGIT model, they are A_AIR A_TRAIN A_BUS.

; Correlated parameters (otherwise, independent)

Consecutive runs of the identical model give different results. Why? Different random draws.

Achieve replicability

(1) Use ;HALTON

(2) Set random number generator before each run with the same value.

CALC ; Ran( large odd number) \$

(Setting the seed is not needed for ;Halton)

SETPANEL ; Group = id ; Pds = ti \$

PROBIT ; Lhs = doctor

; Rhs = One,age,educ,income,female

; RPM ; Pts = 25 ; Halton ; Panel

; Fcn = one(N),educ(N) ; Correlated \$

POISSON ; Lhs = Doctor

; Rhs = One,Educ,Age,Income,Hhkids

; Fcn = educ(N)

; Panel ; Pts=100 ; Halton

; Maxit = 25 \$

And so on…

SETPANEL ; Group = id ; Pds = ti \$

PROBIT ; Lhs = doctor

; Rhs = One,age,educ,income,female

; RPM ; Pts = 25 ; Halton ; Panel

; Fcn = one(N),educ(N) ; Correlated

; Parameters

\$