Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/150683
Authors: 
Luechinger, Simon
Stutzer, Alois
Winkelmann, Rainer
Year of Publication: 
2008
Series/Report no.: 
SOEPpapers on Multidisciplinary Panel Data Research 135
Abstract: 
We discuss a new approach to specifying and estimating ordered probit models with endogenous switching, or with binary endogenous regressor, based on copula functions. These models provide a framework of analysis for self-selection in economic well-being equations, where assigment of regressors may be choice based, resulting from well-being maximization, rather than random. In an application to public and private sector job satisfaction, and using data on male workers from the German Socio-Economic Panel, we find that a model based on Frank's copula is preferred over two alternative models with independence and normal copula, respectively. The results suggest that public sector workers are negatively selected.
Subjects: 
Ordered probit
switching regression
Frank copula
job satisfaction
German Socio-Economic Panel
JEL: 
I31
C23
Document Type: 
Working Paper

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