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The use of limited dependent variable techniques in strategy research: issues and methods
Author(s) -
Wiersema Margarethe F.,
Bowen Harry P.
Publication year - 2009
Publication title -
strategic management journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 11.035
H-Index - 286
eISSN - 1097-0266
pISSN - 0143-2095
DOI - 10.1002/smj.758
Subject(s) - popularity , logit , probit , variable (mathematics) , management science , ordered probit , probit model , economics , logistic regression , econometrics , computer science , marketing , operations research , business , psychology , mathematics , machine learning , social psychology , mathematical analysis
Abstract Strategy researchers are increasingly turning their attention from examining the impact of strategic choices on firm performance to examining the factors that determine strategic choices at the firm level. This shift of research orientation has meant that researchers are increasingly faced with a limited dependent variable (LDV) that takes a limited number of usually discrete values, for which LDV methods such as logit or probit are required. Despite their growing popularity, there appears to be widespread problems in the use of LDV methods. This research note complements recent studies that offer general guidelines by presenting and illustrating the practical steps needed to implement the methods essential for analyzing and interpreting the results from LDV models. Copyright © 2009 John Wiley & Sons, Ltd.