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Treatment Evaluation With Selective Participation and Ineligibles

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  • Monica Costa Dias
  • Hidehiko Ichimura
  • Gerard J. van den Berg

Abstract

Matching methods for treatment evaluation based on a conditional independence assumption do not balance selective unobserved differences between treated and nontreated. We derive a simple correction term if there is an instrument that shifts the treatment probability to zero in specific cases. Policies with eligibility restrictions, where treatment is impossible if some variable exceeds a certain value, provide a natural application. In an empirical analysis, we exploit the age eligibility restriction in the Swedish Youth Practice subsidized work program for young unemployed, where compliance is imperfect among the young. Adjusting the matching estimator for selectivity changes the results toward making subsidized work detrimental in moving individuals into employment.

Suggested Citation

  • Monica Costa Dias & Hidehiko Ichimura & Gerard J. van den Berg, 2013. "Treatment Evaluation With Selective Participation and Ineligibles," Journal of the American Statistical Association, Taylor & Francis Journals, vol. 108(502), pages 441-455, June.
    • Handle: RePEc:taf:jnlasa:v:108:y:2013:i:502:p:441-455
    DOI: 10.1080/01621459.2013.795447
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    Cited by:

    1. Corseuil, Carlos Henrique & Foguel, Miguel N. & Gonzaga, Gustavo, 2019. "Apprenticeship as a stepping stone to better jobs: Evidence from Brazilian matched employer-employee data," Labour Economics, Elsevier, vol. 57(C), pages 177-194.
    2. Carlos Henrique Corseuil & Miguel Foguel & Gustavo Gonzaga & Eduardo Pontual Ribeiro, 2014. "Youth Turnover in Brazil: Job and Worker Flows and an Evaluation of a Youth-Targeted Training Program," CEDLAS, Working Papers 0155, CEDLAS, Universidad Nacional de La Plata.
    3. Gerard J. van den Berg & Antoine Bozio & Mónica Costa Dias, 2020. "Policy discontinuity and duration outcomes," Quantitative Economics, Econometric Society, vol. 11(3), pages 871-916, July.
    4. Black, Dan A. & Joo, Joonhwi & LaLonde, Robert & Smith, Jeffrey A. & Taylor, Evan J., 2022. "Simple Tests for Selection: Learning More from Instrumental Variables," Labour Economics, Elsevier, vol. 79(C).
    5. Marco Caliendo & Ricarda Schmidl, 2016. "Youth unemployment and active labor market policies in Europe," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-30, December.
    6. Albanese, Andrea & Cockx, B. & Dejemeppe, Muriel, 2023. "Long-Term Effects of Hiring Subsidies for Low-Educated Unemployed Youths," Research Memorandum 008, Maastricht University, Graduate School of Business and Economics (GSBE).
    7. David Slichter, 2023. "The employment effects of the minimum wage: A selection ratio approach to measuring treatment effects," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 38(3), pages 334-357, April.

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