I am using the np package in R with the
npregiv command. The program is in beta, and I cannot call ordered(var) on one of my instruments (a bug in the program I am pretty sure, the help file says this is allowed). The variable in question is the number of a particular type of institutions in a district, and all districts are on the [0,13] interval. If I do not call
ordered(), what are the consequences? In a parametric setting it is a question of whether the increments of the ordinal variable are linear or not - I am not sure how to interpret this in the non parametric regression setting.
Otherwise I could call
factor() and convert the variable to an indicator of whether or not there exists an institution in a particular district, but then I am throwing away information.