Tobit Model MLE Derivation | Tobit Modelling Lecture 2

This lecture is part of a course available here: https://www.financeai.co.uk/dividend-...

This section of the course gives you the step-by-step derivation of the maximum likelihood estimator (MLE) for the Tobit Model. If you are not familiar with an MLE, at a high level, all that we are trying to do is find a function that takes in our data and tells us how likely it is that our parameters (the weight of each predictor variable) are correct. We can then use this function to find the optimum parameters given our data.