Endogeneity and Stata's "eregress" Command | Estimation Methods | Stata Tutorials Topic 47

Stata Tutorials Topic 47: Endogeneity and Stata's "eregress" Command | Regression Analysis and Estimation Methods Using Stata

Hi, I am Bob. Today, let me show you how to use the Stata command "eregress" to solve the endogeneity problem caused by omitted variables and sample selection. Omitted variable bias and endogenous sample selection are common issues in causal effects analysis. Stata's extended linear regression command "eregress" gives us a solution to both problems.

Please download the dataset for this topic:
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#Stata #eregress #endogeneity #Endogenous #exogenous #RegressionAnalysisandEstimationMethods #tutorial

The Stata commands in this video:
*OLS Method
regress lwage educ i.region i.race c.age##c.age

estimates store OLS

*Omitted Variable Bias and 2SLS Method
eregress lwage i.region i.race c.age##c.age, endogenous(educ=i.parent_educ i.region i.race c.age##c.age)

estimates store IV

*Sample Selection Bias and Heckmen's Method
eregress lwage educ i.region i.race c.age##c.age, select(workforce=num_children educ i.region i.race c.age##c.age)

estimates store Heckman

*Combination of 2SLS and Heckman Methods
eregress lwage i.region i.race c.age##c.age, endogenous(educ=i.parent_educ i.region i.race c.age##c.age) select(workforce=num_children educ i.region i.race c.age##c.age)

estimates store Comb

esttab OLS IV Heckman Comb, mtitles se star(* 0.1 * 0.05 ** 0.01) b(%7.3f)

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