Dear all,
For my research, I'm evaluating the effect of a proxy variable of abilities (i.e. a standard IQ test) on three limited dependent variables, namely: a dichotomous variable, a discrete variable that goes from 0 to 11, and a continuous variable that ranges from 0 to 1.
Of course, this IQ test might not be an error-free measure of abilities. That is why I would like to instrument it and see if I get something interesting.
However, since I'm considering limited dependent variables as a left-hand-side variable, I am not sure if there is some framework similar to IV using OLS that might be suitable for my setting.
I would be pleased if someone can give some advice on this.
Thanks!
For my research, I'm evaluating the effect of a proxy variable of abilities (i.e. a standard IQ test) on three limited dependent variables, namely: a dichotomous variable, a discrete variable that goes from 0 to 11, and a continuous variable that ranges from 0 to 1.
Of course, this IQ test might not be an error-free measure of abilities. That is why I would like to instrument it and see if I get something interesting.
However, since I'm considering limited dependent variables as a left-hand-side variable, I am not sure if there is some framework similar to IV using OLS that might be suitable for my setting.
I would be pleased if someone can give some advice on this.
Thanks!
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