Hello, guys!
I'm completely lame in the world of econometrics as well as in the world of Stata. Actually I'm a student of biology department but some circumstances made me deepen in this sphere of science. Last week I'm hardly trying to hit the interpretation of models myself but realize that don't have enough knowledge on subject. Just trying to be brief and precise: I have the sample of individuals which I use to estimate regression where logarithm of wages is dependent variable, in other words, traditional Mincer equation. Besides standard array of exogenous variables such as education, work experience and so on, I also use the variable called health, which I mostly interested in. First of all, I estimate coefficients with OLS regression, where individuals, who are unemployed, are excluded from the selection as we can't observe wages for those people. As far as I understand, this fact is the reason for so–called sample selection problem and OLS estimated coefficients are invalid (by the way, is it the correct definition to use or "biased" would be better?). Heckman model introduces additional equation which models decision of individual whether to work or not. Then I run Heckman model in Stata with the same regressors, where previously excluded information about individuals who are unemployed is now also included in selection. For additional regression I use age, male, marriage and education as Heckman originally did let alone using marriage instead of children and having variable male as I have both males and females in selection. The attached tables present the results for OLS and Heckman models.

Taking these results into account I have some misunderstanding:
1) Do the results of F–statistic for OLS regression gathered in addition to R–squared imply that the whole regression is significant and have relatively good explanation power and variable health is significant?
2) How should be Wald statistics results for Heckman model interpreted?
3) What does it mean that rho estimation is positive and equals to 0,166?
4) What is LR test of independent equations, what exactly does it show us?
5) As I can see, coefficients in OLS model and Heckman model are almost the same, is it bad? Does it mean that there's no use in running Heckman model or implication about usefulness should come from some other signs?
I would be very grateful if you "explain it to me like I'm a four–year–old" as I'm afraid I just can't operate with professional language of econometrics.
Cheers, Guest.
I'm completely lame in the world of econometrics as well as in the world of Stata. Actually I'm a student of biology department but some circumstances made me deepen in this sphere of science. Last week I'm hardly trying to hit the interpretation of models myself but realize that don't have enough knowledge on subject. Just trying to be brief and precise: I have the sample of individuals which I use to estimate regression where logarithm of wages is dependent variable, in other words, traditional Mincer equation. Besides standard array of exogenous variables such as education, work experience and so on, I also use the variable called health, which I mostly interested in. First of all, I estimate coefficients with OLS regression, where individuals, who are unemployed, are excluded from the selection as we can't observe wages for those people. As far as I understand, this fact is the reason for so–called sample selection problem and OLS estimated coefficients are invalid (by the way, is it the correct definition to use or "biased" would be better?). Heckman model introduces additional equation which models decision of individual whether to work or not. Then I run Heckman model in Stata with the same regressors, where previously excluded information about individuals who are unemployed is now also included in selection. For additional regression I use age, male, marriage and education as Heckman originally did let alone using marriage instead of children and having variable male as I have both males and females in selection. The attached tables present the results for OLS and Heckman models.
Taking these results into account I have some misunderstanding:
1) Do the results of F–statistic for OLS regression gathered in addition to R–squared imply that the whole regression is significant and have relatively good explanation power and variable health is significant?
2) How should be Wald statistics results for Heckman model interpreted?
3) What does it mean that rho estimation is positive and equals to 0,166?
4) What is LR test of independent equations, what exactly does it show us?
5) As I can see, coefficients in OLS model and Heckman model are almost the same, is it bad? Does it mean that there's no use in running Heckman model or implication about usefulness should come from some other signs?
I would be very grateful if you "explain it to me like I'm a four–year–old" as I'm afraid I just can't operate with professional language of econometrics.
Cheers, Guest.
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