EViews.com

Can someone please tell me how to run a probit and logit regression with Eviews?
I have absolutely no clue how the program works, and need these regressions to finish my thesis.
Both Regressions need to be run on 363(Date of Data) *10 (variables) data items.

For the Probit Regression I have:

- 6 independent control variables and 4 dummy variables.
- Dependent variables are valuation models used by brokers (0=Multiple, 1=DCF)

For the Logit Regression I have:

- 6 independent control variables and 4 dummy variables.
- Dependent variables are valuation models used by brokers (1=Multiple, 2=DCF, 3=SOP)

Thanks in advance!

Do you already have your data in EViews? Which parts of the manual have you looked at?

Do you already have your data in EViews? Which parts of the manual have you looked at?

Yes my data is in Eviews and I found in the manual that I have to select the binary estimation method from the equation objects.
When I enter my equation specification the displayed information shows NA for St.Error, Z-statistic and Prob.

Do you get a warning message on the equation output?

Do you get a warning message on the equation output?

There is indeed a warning message:

Singular covariance - coefficients are not unique
Covariance matrix computed using second derivatives

My equations input is as follows:
valuation_model c volatility size growth leverage mkt_bk r_d @expand(industrysector) @expand(industrysubgroup) @expand(cyclical) @expand(broker)

The regression output gives no warning when I leave the dummy variables out of the equation...

Dummy variable trap.

Dummy variable trap.

If I leave the constant out of the equation I get the following error message:

Non-positive likelihood value for observation 1

See what happens if you only use one @expand statement at at time.

See what happens if you only use one @expand statement at at time.

It works when I only use one @expand statement at at time.
Does this effect the outcome of the regression if I have to perform them seperately instead of at once?

The problem is that you are falling into the dummy variable trap with multiple categories of dummies. Basically, you need to drop one dummy from each category.

Shouldn't I then just rewrite the equation so that every dummy is seperate?

So @recode(MS,1,0) @recode(CS,1,0) @recode(3510,1,0) @recode(3520,1,0) etc?

No. Look at the @drop options in @expand

I tried the following:
@expand(industry, @dropfirst) but then I get the same error message as in the beginning.

Try googling "dummy variable trap"

Thanks for all the help! The probit model is now completed.

Next step is that I have to run a multinomial logit regression.
The dependent variable can be either one of three choices where 1 is the reference point.
The dependent variable is followed by a set of independent variables (regressors?).

How do I have to create the equation so that I get values for both 2nd and 3d choice in one single output model?