Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/76219
Authors: 
Boes, Stefan
Winkelmann, Rainer
Year of Publication: 
2005
Series/Report no.: 
Working Paper, Socioeconomic Institute, University of Zurich 0507
Abstract: 
We discuss regression models for ordered responses, such as ratings of bonds, schooling attainment, or measures of subjective well-being. Commonly used models in this context are the ordered logit and ordered probit regression models. They are based on an underlying latent model with single index function and constant thresholds. We argue that these approaches are overly restrictive and preclude a flexible estimation of the effect of regressors on the discrete outcome probabilities. For example, the signs of the marginal probability effects can only change once when moving from the smallest category to the largest one. We then discuss several alternative models that overcome these limitations. An application illustrates the benefit of these alternatives.
Subjects: 
marginal effects
generalized threshold
sequential model
random coefficients
latent class analysis
happiness
JEL: 
C25
I25
Document Type: 
Working Paper

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