From the course: Introduction to Stata

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Binary outcome models: Solution

Binary outcome models: Solution - Stata Tutorial

From the course: Introduction to Stata

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Binary outcome models: Solution

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(upbeat music) - [Instructor] Let's have a look at the solutions to our binary choice modeling challenge. Before I loaded up the nlsw88 theta set here, and our first challenge was to estimate a problem model of union membership using age, grade, married, and race. So that should be pretty easy to do, except we should note that race and married are categorical variables. So I will expand these with the i-dot prefix. So let's go ahead. We'll type probit, our dependent variable is union, and then age, grade, i.race, and i.married. Let's estimate this. We can see that the variables grade is statistically significant and the variable black. The next challenge was to determine whether this was a good model. Well, the likelihood ratio correspondences indicates that indeed the model does indeed tell us something. However, our pseudo r-square statistic appears to be extremely small and only 1.7 percent. So let's have a look at the…

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