Work GRP 2 Multinomial Probit and Logit Models Examples
Work GRP 2 Multinomial Probit and Logit Models Examples
GROUP 2
Names Reg No
If the multinomial logit is used to model choices, it relies on the assumption of independence of
irrelevant alternatives , which is not always desirable. This assumption states that the odds of preferring
one class over another do not depend on the presence or absence of other "irrelevant" alternatives. For
example, the relative probabilities of taking a car or bus to work do not change if a bicycle is added as
an additional possibility. This allows the choice of K alternatives to be modeled as a set of K-1
independent binary choices, in which one alternative is chosen as a "pivot" and the other K-1 compared
against it, one at a time.
Entering high school students make program choices among general program, vocational
program and academic program. Their choice might be modeled using their writing score
and their social economic status.
The data set contains variables on 200 students. The outcome variable is prog, program
type. The predictor variables are social economic status (ses) a three-level categorical
variable and writing score, write, a continuous variable.
III.a. Interpretation of the data
In the output above, The log likelihood (-179.98173) can be used in comparisons of
nested models.
The likelihood ratio chi-square of 48.23 with a p-value < 0.0001 show that the
model as a whole fits significantly better than an empty model (i.e., a model with
no predictors)
The output above has two parts, labeled with the categories of the outcome
variable prog. They correspond to the two equations below:
where b’s are the regression coefficients.
A one-unit increase in the variable write is associated with a 0.058 decrease in the relative log
odds of being in general program vs. academic program.
A one-unit increase in the variable write is associated with a 0.1136 decrease in the relative log
odds of being in vocation program vs. academic program.
The relative log odds of being in general program vs. in academic program will decrease by
1.163 if moving from the lowest level of ses (ses==1) to the highest level of ses (ses==3).
REFERENCE
- https://stats.idre.ucla.edu/stata/dae/multinomiallogistic-regression/
- William H. Greene, July 10, 2002, Econometric Analysis, New York University.