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Heckman-Selection or Two-Part models for alcohol studies? Depends

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  • Reka Sundaram-Stukel

Abstract

Aims: To re-introduce the Heckman model as a valid empirical technique in alcohol studies. Design: To estimate the determinants of problem drinking using a Heckman and a two-part estimation model. Psychological and neuro-scientific studies justify my underlying estimation assumptions and covariate exclusion restrictions. Higher order tests checking for multicollinearity validate the use of Heckman over the use of two-part estimation models. I discuss the generalizability of the two models in applied research. Settings and Participants: Two pooled national population surveys from 2016 and 2017 were used: the Behavioral Risk Factor Surveillance Survey (BRFS), and the National Survey of Drug Use and Health (NSDUH). Measurements: Participation in problem drinking and meeting the criteria for problem drinking. Findings: Both U.S. national surveys perform well with the Heckman model and pass all higher order tests. The Heckman model corrects for selection bias and reveals the direction of bias, where the two-part model does not. For example, the coefficients on age are upward biased and unemployment is downward biased in the two-part where the Heckman model does not have a selection bias. Covariate exclusion restrictions are sensitive to survey conditions and are contextually generalizable. Conclusions: The Heckman model can be used for alcohol (smoking studies as well) if the underlying estimation specification passes higher order tests for multicollinearity and the exclusion restrictions are justified with integrity for the data used. Its use is merit-worthy because it corrects for and reveals the direction and the magnitude of selection bias where the two-part does not.

Suggested Citation

  • Reka Sundaram-Stukel, 2021. "Heckman-Selection or Two-Part models for alcohol studies? Depends," Papers 2112.10542, arXiv.org, revised Jun 2023.
    • Handle: RePEc:arx:papers:2112.10542
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    References listed on IDEAS

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    1. Mullahy, John, 1998. "Much ado about two: reconsidering retransformation and the two-part model in health econometrics," Journal of Health Economics, Elsevier, vol. 17(3), pages 247-281, June.
    2. John Mullahy, 1998. "Much Ado About Two: Reconsidering Retransformation and the Two-Part Model in Health Economics," NBER Technical Working Papers 0228, National Bureau of Economic Research, Inc.
    3. Leung, Siu Fai & Yu, Shihti, 1996. "On the choice between sample selection and two-part models," Journal of Econometrics, Elsevier, vol. 72(1-2), pages 197-229.
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