in the outcome functions in order to improve identification. To identify the selection instruments, the
paper used variables that affect the choice equation but do not affect the net annual agricultural income
equation for farmers that did not participate. Gender and credit amount obtained were the selection
instruments used that satisfied our falsification test.
We assumed a trivariate normal distribution, with zero mean and a covariance matrix represented by
Σ, i.e., (ε, μ1, μ0) ~ (0, Σ). This assumption was made considering the correlation between error terms
in the selection (participation) and outcome equations, respectively, due to systematic differences in
net annual agricultural income with and without BVIS. The covariance matrix Σ is expressed as follows: