Probit with heteroscedasticity:An application to Indian poverty analysis

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Parikh, A. and Sen, K. (2006) Probit with heteroscedasticity:An application to Indian poverty analysis. Applied Economics Letters, 13 (11). pp. 699-707. ISSN 1350-4851

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Abstract

This study argues that in limited dependent variable models, when there is heteroscedasticity, a probit model with a heteroscedastic structure should be estimated. The problem is illustrated using unit record data from the Indian National Sample Survey to analyse the determinants of poverty at household level. It is found that these biases are large even with large number of observations because in the limited dependent variable case, the bias does not vanish asymptotically when the assumption of homoscedasticity breaks down. Both regression coefficients and marginal effects differ widely between probit and hetprobit models in this study.

Item Type:	Article
Faculty \ School:	Faculty of Social Sciences > School of Economics Faculty of Social Sciences > School of Global Development (formerly School of International Development)
Related URLs:	http://www.scopus.com/inward/record.url?...
Depositing User:	Pure Connector
Date Deposited:	19 Nov 2013 16:14
Last Modified:	24 Oct 2022 05:04
URI:	https://ueaeprints.uea.ac.uk/id/eprint/44494
DOI:	10.1080/13504850500402096

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