47 research outputs found
Demand-Side Management by Electric Utilities in Switzerland: Analyzing Its Impact on Residential Electricity Demand
Dirty History Versus Clean Expectations: Can Energy Policies Provide Momentum for Growth?
Equitable and Effective Climate Policy: Integrating Less Developed Countries into a Global Climate Agreement
ISSN:1612-4804ISSN:1612-481
A Note on the Different Interpretation of the Correlation Parameters in the Bivariate Probit and the Recursive Bivariate Probit
This note makes the point that, if a Bivariate Probit (BP) model is estimated on data arising from a Recursive Bivariate Probit (RBP) process, the resulting BP correlation parameter is a weighted average of the RBP correlation parameter and the parameter associated to the endogenous binary variable. Two corollaries follow this proposition: i) a zero correlation parameter in a BP model, usually interpreted as evidence of independence between the binary variables under study, may actually mask the presence of a RBP process; and ii) the interpretation of the correlation parameter in the RBP is not the same as in the BP -- i.e. the RBP correlation parameter does not necessarily reflect the correlation between the binary variables under study