Hi every body,
I am working on Two-stage Heckman method as an economic model to estimate WTP of tourists for visiting a heritage site. I am wondering in the Probit model (first stage) marginal effect or Weighted Aggregate Elasticity should be interpreted? Which one is more common and what is the difference between them?
Thanks you all for your time to answer me
HoDa
Generally, in order to correct for the sample bias problem, the Heckman's two-step estimation method (Heckman, 1978) is used. In the first stage, the probit regression is used to estimate the probability of WTP for visiting a heritage site. This regression is used to estimate the inverse Mills ratio (l) for each individual, which is used as an instrument in the second regression. In the second stage, the initial model with the inverse Mills ratio is estimated.
From the Probit estimates of the probability of WTP for visiting a heritage site, you can derive the marginal effects.
Mounir,
Thanks for your answer. So, how about the elasticity? Should I interpret it as well?
How it could be interpreted?
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