Authors: Tue Gørgens, Dean Hyslop
There are two common approaches to analyzing discrete-time two-state panel data: one focuses on modeling the determinants of state occupancy, the other on modeling the determinants of transition between states. This note shows that there are one-to-one correspondences between the two representations, between the two probability distributions in an unrestricted context, and between low-order Markov models of state occupancy and semi-Markov models of transition between states with strictly limited duration dependence.
This article is behind a paywall.
Gørgens, Tue and Dean Hyslop. 2018. "Equivalent representations of discrete-time two-state panel data models." Economics Letters, Vol 163 p65-67 https://doi.org/10.1016/j.econlet.2017.12.003
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