Two-Step Parameter Estimation Method Of The Censored Type-2 Tobit Model

Since Tobin proposed the Tobit Model, this kind of model has gained widespread attention from the scholars and many new models have been derived from it. This kind of models are widely used in studies of various aspects, such as labor supply, education, consumption and medicine.Firstly, we classify the Tobit Model according to its likelihood function and give a specific form and a maximum likelihood function form as well as application examples for each kind of model. Then we classify the Tobit Model according to the criterion that if the model is the Simultaneous Equation Model and describes the research progress as well as the main estimation model of different kinds of the Tobit Model. Finally, taking the Type-2 Tobit Model as an example, we give detailed introduction including application of the model and its structure and two important estimation methods.On the basis of the Type-2 Tobit Model, we add a censored structure to the model to build a new model. In this paper, we give detailed introduction of the new model’s structure, data structure and estimation method, focusing on its improved two-step esti-mation method from the Heckman’s two-step estimation method. Also we provide data simulation for the new two-step estimation method that we investigate at different cen-sored rates and for different parameter values,and finally we obtain satisfied simulation results.