What about those zeroes - A Monte Carlo study of estimators for corner solution outcomes

Abstract

Partially continuous and limited dependent variables are commonly observed in empirical research. This thesis focuses on evaluating Tobit-type models, which are designed for these situations, with specific regard to small samples. By using a comparatively broader specification then has previously, model performance is evaluated for a range of scenarios. The results indicate that the simple Tobit has best small sample properties, although the bias diminishes above 100 observations for all models. Furthermore, all models are less biased for a log rather than level specification, suggesting that the former is preferable use in practice.