Linear Probability Model
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- Опубликовано: 11 сен 2024
- This video dives into the world of binary choice models, specifically focusing on the linear probability model (#LPM)
We'll start by defining the LPM and how it explains the probability of an event happening based on different factors.
Learn how to #specify the LPM equation, including the role of the constant term and explanatory variables.
We'lle explore how to estimate the model's parameters using ordinary least squares (OLS).
Discover how to interpret the results and what the coefficients tell us about the relationship between factors and the probability.
We'll discuss the #limitations of the LPM, including potential issues with predicted probabilities and alternative models to consider.
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