Heckman Approach Research Articles

Cash usage in Poland in 2020: Insights into the role of the COVID-19 pandemic and spatial aspects

The study explores the factors likely to induce Polish customers to pay by cash, instead of payment cards, for goods and services they are purchasing. The basis of our investigation is microdata obtained in 2020, during the “Payment Habits in Poland in 2020” study, which was conducted by Narodowy Bank Polski (National Bank of Poland) in 2020. The analysis is performed using the two-stage Heckman approach. In the first stage, card adoption factors are analyzed using a probit model; then, in the second stage, the OLS model is employed to analyze the propensity to pay by cash, despite having a payment card. Apart from typical factors affecting the use of different payment methods, e.g., age, income, education, or perceptions about payment methods, we find an important role of two, yet under-investigated factors, namely: the COVID-19 pandemic and spatial aspects. E.g., we find that self-reported change in payment behavior during the pandemic indeed was reflected in diary studies. Furthermore, we show that instances of merchants’ refusal to accept cash significantly impacted payment choices. Moreover, the results indicate significant spatial heterogeneity in payment behavior and that aspects like distance to the nearest ATM impacted cash usage, as more cash is used when ATMs are farther away, illustrating the concept of "cash burns." Lastly, it has been noticed that during the pandemic, ownership of contactless payment cards significantly reduced cash usage, most probably due to the fear of contracting the disease by physical contact with surfaces (like cash).

A Crossed Analysis of Participations in Labor and Grain Markets: Evidence from Malawi

Abstract This study contributes to the literature on the identification of factors shaping the decision to participate in the grain market in Africa. Unlike previous studies, we introduce labor market participation into the farm household model to highlight heterogeneities in decision making. Empirically, we rely on an extension of Heckman's approach and introduce control functions to mitigate endogeneity issues related to the adoption of agricultural technologies. We find that limited access to transportation infrastructure, by discouraging the supply of grain, constrains households to experience an excess of labor; price incentives may have a reverse effect on the choice of market regimes, even though the effect on production may be positive for households that are already participants. We also show that farmers' responses to grain prices are not sensitive to their labor market position. The use of agricultural technologies encourages cereal production and employment of external agricultural labor. This study thus provides a better targeting when designing policies promoting marketing and rural employment.

Well‐being and doctor visits: The mediating role of a healthy diet

AbstractSubjective well‐being is associated with many positive health outcomes. However, little is known about whether these favourable outcomes translate into a reduction in the number of doctor visits. Using large‐scale panel data from Australia, we find that individuals with high life satisfaction need fewer visits to their family doctor or general practitioner. We also present evidence on the pathways underlying this relationship, showing it is significantly explained by a person's diet. These findings remain after correcting for sample selection bias using Heckman's approach as well as controlling for various confounding factors.

Investigating socio-economic factors underlying urban consumers' willingness to pay extra for drinking water

Abstract The purpose of this study is to investigate the impact of economic and social factors on increasing public participation in the urban drinking water sector to develop a suitable plan for the coming years due to the growing population. The research instrument is a researcher-made questionnaire whose validity and reliability were confirmed. Then, 1,230 questionnaires were distributed among the citizens of Ardabil, Iran. A two-stage Heckman approach was used to estimate the valuation model. The results showed that the education, age, water health concern, income, household cost, household size and water quality satisfaction had a significant role in the amount of willingness to pay extra (WTP). The results showed that the variable age, income and water quality have a positive effect on WTP; with increases in the age, income and the water quality, WTP increases. However, in contrast to the water bill, concerns about the health of water and children have a negative effect on WTP. The results showed that the government could increase their tendency to participate with the government by informing people to water value and improve the quality of water.

Factors Affecting Success of Entrepreneurship in Agribusinesses: Evidence from the City of Mashhad, Iran

Entrepreneurship and innovation are the fuel of economic growth. Understanding the motivational factors that lead to the success of entrepreneurs in agribusiness can be useful in affecting the degree of successful investment that accelerates development and economic growth in the agriculture sector. In this study, we investigated the factors affecting the success of entrepreneurs in the agribusiness sector in Mashhad, Iran, using a two-stage Heckman approach. Factors affecting the success or failure of agribusiness entrepreneurship have received less attention in the literature. In this study, the aim was to determine the factors affecting agricultural entrepreneurship success and entrepreneurs’ profits. We generated the data for this study by designing a questionnaire and conducting a survey of active entrepreneurs in Mashhad in 2020. The results showed that entrepreneurship experience, risk-taking behavior, interest rates, and initial capital have a significant impact on the probability of entrepreneurship success and entrepreneur’s profits. Policies that could improve the skills of entrepreneurs, provision of initial capital requirements, and financial market efficiency had an effective role in increasing entrepreneurship and innovation in the agribusiness sector. Entrepreneurs in the field of agriculture could consider these factors to have better choices while entering or continuing with their agribusinesses. Our recommendation to policymakers and agribusiness leaders is to establish a friendlier and more stable environment for entrepreneurship and employ policies that help reduce the risk of entrepreneurs’ initial investment returns.

Socio-cultural and economic factors affecting the choice of food diet in West Africa: a two‑stage Heckman approach

West African countries have made impressive progress in fighting against malnutrition and hunger and ensuring food quality and varying food choices. This paper aimed for the first time to evaluate the determinants of diet choice by the populations of West Africa, especially those of Benin, Togo, and Nigeria. The data collected from 473 people relate mainly to their socioeconomic and cultural characteristics and the factors determining the choice of the diet for which they have opted. These data were analyzed using the Tobit model based on the Heckman method. The statistical analysis of the results obtained allowed us to deduce that the populations studied generally opt for a flexitarian, vegetarian or vegan diet. The age, level of education, religious and ancestral beliefs, social framework, monthly income, perception of the costs generated by each diet, perception of the consumption of products of animal origin such as meat and fish have a significant influence on the choice of diet. The intensity of the chosen diet was determined by variables such as sex, level of education, social framework, perception of consumption of animal products, and meat and fish. Diet being a determining parameter of our state of health, it is imperative to make people aware of the different diets so that they can identify and adopt the one that suits them best.

The impact of state capacity on the cross-country variations in COVID-19 vaccination rates.

The initial period of vaccination shows strong heterogeneity between countries’ vaccinations rollout, both in the terms of the start of the vaccination process and in the dynamics of the number of people that are vaccinated. A predominant thesis for this observation is that a key determinant of the swift and extensive vaccine rollout is state capacity. Here, we utilize two measures that quantify different aspects of the state capacity: (i) the external capacity (measured through the soft power of the country) and (ii) the internal capacity (measured via the country’s government effectiveness) and provide an empirical test for their relationship with the coronavirus vaccination outcome in the initial period (up to 31st March 2021). By using data on 128 countries and a two-step Heckman approach, we find that the soft power is a robust determinant of whether a country has started with the vaccination process. In addition, the government effectiveness is a key factor that determines vaccine roll-out. Altogether, our findings are in line with the hypothesis that state capacity determines the observed heterogeneity between countries in the initial period of COVID-19 vaccines rollout. As such, they are a stark reminder for the need for transparent and fair global response regarding fair and equitable availability of vaccines to every country.

Tingkat Pengembalian Investasi Pendidikan Tinggi Lulusan Program Studi STEM (Science, Technology, Engineering, dan Mathematics)

This study aims to analyze the rate of return on investment in higher education for graduates of STEM study programs using data from the 2019 National Labor Force Survey (SAKERNAS). This study uses the Ordinary Least Square (OLS) method with a two-step Heckman approach. The result is that the highest rate of return on investment for STEM graduates occurs at the master's level and the rate of return on investment for female STEM graduates is higher than that of men. STEM study programs have a stereotype, namely study programs with expensive costs and requirements for masculinity, therefore it is necessary to increase the number of scholarships, especially in postgraduate programs and provide equal opportunities for men and women to study and work in the STEM field.

Determinants of Household Income and Willingness to Pay for Indigenous Plants in North West Province, South Africa: A Two-Stage Heckman Approach

Using a cross-sectional dataset, this study examines the factors influencing the income and willingness to pay for indigenous plants by rural households in the North West Province of South Africa. The method of data analysis was based on a two-stage Heckman model. Based on empirical data, the majority (93%) of the households are willing to pay for the indigenous plants. Furthermore, factors such as the age of the household’s head, marital status, size of households, financial returns and economic benefit of indigenous plants significantly influenced income and willingness to pay for indigenous plants by the households. Thus, indigenous plants have the potential to penetrate local and international markets and can be used to improve the economies, livelihood, and food security status of rural households in South Africa. Indigenous plant cultivation can increase agro-food system species diversity while conserving plant species indigenous to this area of South Africa. Encouraging both consumption and production of indigenous plants can also help diversify local economies and communities.

Subjective well-being and healthcare utilization: A mediation analysis.

Subjective well-being measures are gaining recognition as important determinants of health outcomes. This paper examines whether life satisfaction matters for healthcare usage in the older population and, if so, what might help explain this relationship. To that end, we develop a mediation framework and test whether lifestyle choices and social capital are pathways through which life satisfaction at baseline influences subsequent healthcare usage. Using Heckman's approach to correct for sample selection bias, we find that those high in life satisfaction may need less outpatient care. We also show that this effect is explained by increased physical activity.

The impact of postponing motherhood on women's income in Brazil

This paper investigates the impact of the postponement of motherhood on women’s earnings and gender gap in Brazilian labor market, based on data from Brazilian National Health Survey of 2013. Using the Heckman (1979) approach, the results suggest that postponing motherhood has a positive impact of 1.55% on earnings each year of postponement. By comparing men and women, the results suggest that being a woman generates a wage penalty of approximately 22%, but the postponing of motherhood can eliminate that gender gap, especially for those who are white, yellow, and higher educated.

Copula Models for Addressing Sample Selection in the Evaluation of Public Health Programmes: An Application to the Leeds Let's Get Active Study.

Sample selectivity is a recurrent problem in public health programmes and poses serious challenges to their evaluation. Traditional approaches to handle sample selection tend to rely on restrictive assumptions. The aim of this paper is to illustrate a copula-based selection model to handle sample selection in the evaluation of public health programmes. Motivated by a public health programme to promote physical activity in Leeds (England), we describe the assumptions underlying the copula selection, and its relative advantages compared with commonly used approaches to handle sample selection, such as inverse probability weighting and Heckman's selection model. We illustrate the methods in the Leeds Let's Get Active programme and show the implications of method choice for estimating the effect on individual's physical activity. The programme was associated with increased physical activity overall, but the magnitude of its effect differed according to adjustment method. The copula selection model led to a similar effect to the Heckman's approach but with relatively narrower 95% confidence intervals. These results remained relatively similar when different model specifications and alternative distributional assumptions were considered. The copula selection model can address important limitations of traditional approaches to address sample selection, such as the Heckman model, and should be considered in the evaluation of public health programmes, where sample selection is likely to be present.

The Impact of State Capacity on the Cross-Country Variations in COVID-19 Vaccination Rates

The initial period of vaccination shows strong heterogeneity between countries’ vaccinations rollout, both in the terms of the start of the vaccination process and in the dynamics of the number of people that are vaccinated. A predominant thesis in the ongoing debate on the drivers of this observed heterogeneity is that a key determinant of the swift and extensive vaccine rollout is state capacity. Here, we utilize two measures that quantify different aspects of the state capacity: i) the external capacity (measured through the soft power and the economic power of the country) and ii) the internal capacity (measured via the country’s government effectiveness) and investigate their relationship with the coronavirus vaccination outcome in the initial period (up to 30th January 2021). By using data on 189 countries and a two-step Heckman approach, we find that the economic power of the country and its soft power are robust determinants of whether a country has started with the vaccination process. In addition, the government effectiveness is a key factor that determines vaccine roll-out. Altogether, our findings are in line with the hypothesis that state capacity determines the observed heterogeneity between countries in the initial period of COVID-19 vaccines rollout.

Assessing Food Insecurity Trends and Determinants by using Mix Methods in Pakistan: Evidence from Household Pooled Data (2005-2014)

In this study, we try to indirectly quantify the welfare of people in Pakistan through measuring the food insecurity, malnutrition during last decade (2005-14). This study takes lead from earlier studies, in a sense; it covers two food price hike periods (2007 and 2011). So, it is important to understand, how food insecurity status and nutrition are affected by these shocks during this period. Thus, we use nationally representative data called as Household Income and Expenditure Survey (HIES) from 2005-2014. Pakistan Bureau of Statistics collects this data in five rounds; 2005-06, 2007-08, 2010-11, 2011-12, and 2013-14 comprised 81102 households. Results from the headcount ratios suggest that over the period food insecurity trends of the households raised from (58%) to (77%). we find urban households are more food insecure over the time as compared to rural households. Whereas, in qualitative terms of food insecurity, we use two food diversification measures; one is dietary diversity score and second one is share of staple food in total calories consumed by household, suggest that households dietary diversity score is good on average that is 9 out of 10 food groups and on the whole it is slightly improved from (8.8 %) to (9%) in previous 10 years. Interestingly, when we analyze the share of staple food in total calories, results suggest that major portion of a household's diet is consisting of staple food (wheat), (53%) and increased to (57%) from 2005 to 2014. We use the Heckman Approach to find out determinants of food insecurity. Results suggest that female headship plays a significant positive role in caloric intake, among the other variable head education, households' member with basic education and higher education, live stock ownership, consumption of livestock produced at home, farming, consumption of food crop produced at home and foreign and domestic remittances plays a significant positive role in caloric intake of food insecure households.

Commercializing university research in transition economies: Technology transfer offices or direct industrial funding?

There is a paucity of knowledge on research commercialization by university scientists worldwide. The objective of this paper is to identify the role that Technology Transfer Offices (TTOs) and direct Industrial Funding play in university research commercialization in transition economies of Azerbaijan, Belarus and Kazakhstan during 2015–2017. We do this by developing a novel database and a multi-level model which explains how individual attributes, organizational and ecosystem characteristics explain the extent of knowledge commercialization.We apply the generalized Heckman approach to account for two selection biases, reducing the sample from 2602 to 272 scientists, and further use a mixed-method approach to analyse 27 face-to-face interviews with researchers and TTO managers. The results demonstrate that research commercialization is not associated with the existence and awareness of TTO or the establishment of commercialization contracts via TTO, but the direct industrial funding of university research. Taken together the findings have clear implications for scholars, scientific entrepreneurs, TTOs and investors who aim to exploit university knowledge in transition economies.

Gender diversity and financial performance: evidence from US REITs

ABSTRACTOur paper is the first to identify the determinants which explain the presence of women on the board of directors and to study the relationship between gender diversity and financial performance in a US REIT context. We apply a two-stage Heckman approach to a unique panel dataset of 112 US Equity REITs over the period 2005–2015. Our results show that a REIT’s likelihood of having a woman on the board of directors depends strongly on board attributes. Especially institutional investors support gender-diverse leadership teams, which might be driven by the perception that women contribute to an enhanced internal monitoring in the REIT context, in which external monitoring is weakened through ownership restrictions. We find evidence of a U-shaped relationship between gender diversity in executive positions and price per net asset value (PRICE/NAV). In the case of REITs, a critical mass of female executives is reached at approximately 30% representation. This finding holds especially for real estate sectors with a strong consumer orientation and a high proportion of women in the workforce, such as retail and healthcare. Our performance analysis demonstrates that gender diversity has a positive effect on market performance (PRICE/NAV), but not on operating performance (FFO/SHARE).

Why do German physicians reject managed care?

Approximately 20years after the launch of managed care (MC) in Germany, the initial dynamics have turned into an MC backlash with a poor image for MC among physicians and the insured. Factors in MC contract rejection by physicians have not previously been studied systematically. The objective of the study is to show that observed physician characteristics explain MC contract rejection in a quantitative model. These econometric findings will be related to suitable political measures to foster physicians' MC acceptance. Results are based on 500 completed responses to a survey among practicing physicians in Northern Germany. Physician cooperation, attitudes toward MC, and practice characteristics are addressed. A Heckman approach accounts for potential preselection of physicians by insurers. Econometric findings are complemented by a qualitative analysis of free-text answers. Private patient share, physician age, and number of physicians per practice significantly increase rejection probability, whereas it is decreased by rural location. Qualitatively, administrative burden and loss of professional autonomy are the main reasons for MC refusal. Current health policy focuses on institutional measures such as innovation funding to promote MC. Our results show that it may be more effective to turn attention to practicing physicians' preferences as a bottleneck to MC development.

Does household credit benefit child schooling for the poorest ethnic minorities? New evidence from a transitional economy

This paper provides an original contribution concerning the influence of microcredit on child school dropout rates in the poorest regions in Vietnam. Two crucial empirical problems for the linkage between microfinance and children's education are sample selection bias and the endogeneity of microcredit. Using a combination of the instrumental variable method and the Heckman approach to overcome these problems, the finding is that microcredit increases the opportunity for households to send their children to school through two main channels—increasing household per capita income and moving households out of poverty.

Farm business financial performance in local foods value chains

PurposeThe purpose of this paper is to identify the factors associated with farm financial success for those farms known to produce for local supply chains. The analysis considers alternative measures of farm financial performance and considers the role of the local foods supply chain in the choice to market locally.Design/methodology/approachThe paper uses a two-stage Heckman approach which addresses the possibility of sample selection bias. In the first stage, the choice model to engage in direct marketing is estimated. In the second stage, the authors estimate a model of the financial performance of those in the sample that direct marketed which includes an IMR term calculated from the parameters of the first stage equation. The analysis uses national farm-level data from the Agricultural and Resource Management Survey of the US Department of Agriculture and combines data from 2009 to 2012 to overcome the constraint of small samples.FindingsIndicators of the development of a local foods supply were positively related to the choice to engage in direct marketing. Factors affecting farm financial performance varied significantly between a short-term and a long-term measure. The results emphasize the importance of considering multiple outcome measures, developing local supply chains and provide implications about beginning farms.Originality/valueIf a local foods system is going to thrive, the farms that market the agricultural products in the local food system must attain a certain level of profitability. The value of the analysis is an improved understanding of the financial performance of farms producing for a small, but growing segment of the food supply chain.

Handling Protest Responses in Contingent Valuation Surveys.

Protest responses, whereby respondents refuse to state the value they place on the health gain, are commonly encountered in contingent valuation (CV) studies, and they tend to be excluded from analyses. Such an approach will be biased if protesters differ from non-protesters on characteristics that predict their responses. The Heckman selection model has been commonly used to adjust for protesters, but its underlying assumptions may be implausible in this context. We present a multiple imputation (MI) approach to appropriately address protest responses in CV studies, and compare it with the Heckman selection model. This study exploits data from the multinational EuroVaQ study, which surveyed respondents' willingness-to-pay (WTP) for a Quality Adjusted Life Year (QALY). Here, our simulation study assesses the relative performance of MI and Heckman selection models across different realistic settings grounded in the EuroVaQ study, including scenarios with different proportions of missing data and non-response mechanisms. We then illustrate the methods in the EuroVaQ study for estimating mean WTP for a QALY gain. We find that MI provides lower bias and mean squared error compared with the Heckman approach across all considered scenarios. The simulations suggest that the Heckman approach can lead to considerable underestimation or overestimation of mean WTP due to violations in the normality assumption, even after log-transforming the WTP responses. The case study illustrates that protesters are associated with a lower mean WTP for a QALY gain compared with non-protesters, but that the results differ according to method for handling protesters. MI is an appropriate method for addressing protest responses in CV studies.