Limited dependent variable

A limited dependent variable is a variable whose range of possible values is "restricted in some important way."[1] In econometrics, the term is often used when estimation of the relationship between the limited dependent variable of interest and other variables requires methods that take this restriction into account. For example, this may arise when the variable of interest is constrained to lie between zero and one, as in the case of a probability, or is constrained to be positive, as in the case of wages or hours worked.

Limited dependent variable models include:[2]

See also

See also

References

  1. Wooldridge, J.M. (2002). Econometric Analysis of Cross Section and Panel Data. MIT Press, Cambridge. p. 451. ISBN 0-262-23219-7. OCLC 47521388.
  2. Maddala, G.S. (1983). Limited-Dependent and Qualitative Variables in Econometrics. Cambridge University Press, Cambridge, UK. ISBN 0-521-33825-5. OCLC 25207809.
  3. Stock, James H.; Watson, Mark W. (2003). Introduction to Econometrics. Addison-Wesley, Boston. pp. 328–9. ISBN 0-201-71595-3. OCLC 248704396.


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