Problem 1. In a binary choice/response model: = X3 + Wi G(ui) Ui Y; 1{Y;* >0} (a) Show that any re-scaling of the model:

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Problem 1 In A Binary Choice Response Model X3 Wi G Ui Ui Y 1 Y 0 A Show That Any Re Scaling Of The Model 1 (54.78 KiB) Viewed 18 times

Problem 1. In a binary choice/response model: = X3 + Wi G(ui) Ui Y; 1{Y;* >0} (a) Show that any re-scaling of the model: Y* X/7 + oei li G(ui) 1{Y;* >0} Y; where 7 - oß will not affect the marginal effects in conditional choice/response probabilities: ӘР(Х) axi (b) Suppose there is perfect multicollinearity in the data: 2-1 X;X; is not full rank. Will it be an issue for a logit or probit estimator? Why or why not.