The Uses of Tobit Analysis

Abstract

In this paper authors point out that the coefficients obtained from using Tobit-here called beta coefficients - provide more information than is commonly realized. In particular, authors show that Tobit can be used to determine both changes in the probability of being above the limit and changes in the value of the dependent variable if it is already above the limit$ and authors show that this decomposition can be quantified in rather useful and insightful ways.