Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/279144 
Year of Publication: 
2023
Series/Report no.: 
IZA Discussion Papers No. 16446
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
We analyze persistence in marijuana consumption utilizing data from the 1997 cohort of the National Longitudinal Survey of Youth (NLSY97). We allow for three sources of persistence: pure state dependence, time invariant unobserved heterogeneity and persistence in idiosyncratic, time-varying shocks. We also consider intensity of consumption based on days of use per month and estimate a dynamic ordered Probit model using simulated Maximum Likelihood. We consider a Polya model that generalizes the more commonly used Markov models. The results show that there is a causal eect of previous use. However, ignoring unobserved heterogeneity and serially correlated shocks signicantly exaggerates the state dependence.
Subjects: 
marijuana
persistence
state dependence
Polya model
unobserved heterogeneity
dynamic ordered probit
simulation
NLSY
JEL: 
I12
Document Type: 
Working Paper

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