Probit and Logit Models

Probit and logit models are among the most popular models.  The dependent variable is a binary response, commonly coded as a 0 or 1 variable.  The decision/choice is whether or not to have, do, use, or adopt.  Examples include whether a consumer makes a purchase or not, and whether an individual participates in the labor market or not.

Probit and logit models: topics covered
  • Linear regression model, probit, and logit models functional forms and properties
  • Model coefficients and interpretations
  • Marginal effects (and odds ratios) and interpretations
  • Goodness of fit statistics (percent correctly predicted and pseudo R-squared)
  • Choice between probit and logit
  • Economic models that lead to use of probit and logit models




Probit and Logit Models



Probit and Logit Models Example



Probit and Logit Models in Stata



Probit and Logit Models in R



Probit and Logit Models in SAS


Probit and Logit Models in SPSS