Scribd
Upload
128 views

Probit Model: Conceptual Framework

Probit models are used for binary regression where the dependent variable can take only two values, like married/not married. The probit model estimates the probability that observations with certain characteristics fall into one of the two categories. It treats the same problems as logistic regression but uses a probit link function and normal distribution. Probit models were introduced in 1934 and a fast maximum likelihood estimation method was proposed in 1935. The probit model can be motivated as a latent variable model where an unobserved normal variable determines category membership based on its sign.

Uploaded by

Md Azim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
128 views

Probit Model: Conceptual Framework

Probit models are used for binary regression where the dependent variable can take only two values, like married/not married. The probit model estimates the probability that observations with certain characteristics fall into one of the two categories. It treats the same problems as logistic regression but uses a probit link function and normal distribution. Probit models were introduced in 1934 and a fast maximum likelihood estimation method was proposed in 1935. The probit model can be motivated as a latent variable model where an unobserved normal variable determines category membership based on its sign.

Uploaded by

Md Azim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 1

Probit Model 

In statistics, a probit model is a type of regression where the dependent variable can only take two
values, for example married or not married. The word is a portmanteau, coming
from probability + unit.[1] The purpose of the model is to estimate the probability that an observation
with particular characteristics will fall into a specific one of the categories; moreover, if estimated
probabilities greater than 1/2 are treated as classifying an observation into a predicted category, the
probit model is a type of binary classification model.
A probit model is a popular specification for an ordinal[2] or a binary response model. As such it treats
the same set of problems as does logistic regression using similar techniques. The probit model,
which employs a probit link function, is most often estimated using the standard maximum
likelihood procedure, such an estimation being called a probit regression.
Probit models were introduced by Chester Bliss in 1934;[3] a fast method for computing maximum
likelihood estimates for them was proposed by Ronald Fisher as an appendix to Bliss' work in 1935.

Conceptual framework[edit]
Suppose a response variable Y is binary, that is it can have only two possible outcomes which we
will denote as 1 and 0. For example Y may represent presence/absence of a certain condition,
success/failure of some device, answer yes/no on a survey, etc. We also have a vector
of regressors X, which are assumed to influence the outcome Y. Specifically, we assume that the
model takes the form
where Pr denotes probability, and Φ is the Cumulative Distribution Function (CDF) of the
standard normal distribution. The parameters β are typically estimated by maximum likelihood.
It is possible to motivate the probit model as a latent variable model. Suppose there exists an
auxiliary random variable
where ε ~ N(0, 1). Then Y can be viewed as an indicator for whether this latent variable is
positive:
The use of the standard normal distribution causes no loss of generality compared with
using an arbitrary mean and standard deviation because adding a fixed amount to the
mean can be compensated by subtracting the same amount from the intercept, and
multiplying the standard deviation by a fixed amount can be compensated by multiplying
the weights by the same amount.
To see that the two models are equivalent, note that

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy