- Thread starter endlessend25
- Start date
- Tags binary response models mle ols

I'm supposed to get a consistent and if possible efficient estimates when I run a model as far as I know.

+ of ML

- Consistency, efficiency, asymptotic normality

- Unifiied, general theory of estimation and testing

- of ML

- Need to specify the distribution

- Danger of Misspecification

- All results are asymptotic (why is that a problem ? )

+ of Linear Probability Model:

- Simple OLS estimation (with robust s.e.)

- Straightforward interpretation of parameters

- Other linear methods can be easily applied

- of LPM

- Heteroskedastic s.e.

Predictions sometimes outside the unit interval

Do you agree with that ?