{smcl}
{hline}
help for {cmd:crtest}{right:Joao Pedro W. de Azevedo}
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{title:Cramer-Ridder Test for pooling states in a {cmd:Multinomial Logit}}
{p 8 27}{cmdab:crtest}
{title:Description}
{p 4 4 2}{cmd:crtest} performs the Cramer-Ridder test for pooling states in the
Multinomial logit model.{p_end}
{title:Examples}
{p 8 12 2}{cmd:.mlogit occup1 female under35 married2}{p_end}
{p 8 12 2}{cmd:.crtest}{p_end}
{title:Technical details}
{p 4 4 2}This test assume a multinomial logit model with (S+1) states and two
states that are candidates for pooling, s1 and s2. The null hypothesis is that
s1 and s2 have the same regressors coefficient apart from the intercept, or{p_end}
{p 32 0 0}Bs1 = Bs2 = Bs (1){p_end}
{p 4 4 2}To test this hypothesis the following test statistics can be used:{p_end}
{p 32 0 0}LR = 2{lnL - lnLr} (2){p_end}
{p 4 4 2}where lnL is the maximum log likelihood of the original model and lnLr
the maximum log likelihood if the estimates are constrained to satisfy (1).
LR asymptotically has a chi-square distribution with k degrees of freedom
where k is the number of restrictions implied by (1). LnL is readily available
from the original model, but the lnLr apparently requires constrained estimation
which can be quite laborious.{p_end}
{p 4 4 2}Cramer and Ridder (1991) show that the lnLr can be easily derived from
an unconstrained estimation of the pooled model with only S states. The following
expression to estimate the restricted maximum log likelihood is then presented by
the authors,{p_end}
{p 32 0 0}lnLr = ns1*ln(ns1) + ns2*ln(ns2) - ns*ln(ns) + lnLp{p_end}
{p 4 4 2}where lnLp is the unconstrained maximum of the log likelihood of the pooled
model. ns1 and ns2 are the number of observations on the states s1 and s2,
respectively, and ns = ns1 + ns2.{p_end}
{title:References}
{p 4 8 2}Cramer,J.S. and G.Ridder (1991) "Pooling states in multinomial logit model."
{it:Journal of Econometrics}, 47: 267-272.{p_end}
{title:Authors}
Joao Pedro W. de Azevedo, University of Newcastle, UK
j.p.azevedo@ncl.ac.uk
{title:Aknowledgements}
{p 4 4 2}This ado file uses the auxiliary ado file _pecats written by J. Scott Long
and Jeremy Freese.{p_end}
{p 4 4 2}I would like to thank Brian Poi, Christopher Baum and Nick Cox
for their helpfull suggestions.{p_end}
{p 4 4 2}As usual, all mistakes are of my own responsibility.{p_end}
{title:Also see}
{p 4 13 2}Manual: {hi:[R] mlogit}{p_end}
{p 4 13 2}Online: help for {help mlogtest}; {help iia}; {help smhsiao} (if installed){p_end}