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Dynamic Treatment Assignment – The Consequences for Evaluations Using Observational Data

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Author Info

  • Fredriksson, Peter

    ()
    (Stockholm University)

  • Johansson, Per

    ()
    (IFAU)

Abstract

This paper discusses the evaluation problem using observational data when the timing of treatment is an outcome of a stochastic process. We show that the duration framework in discrete time provides a fertile ground for effect evaluations. We suggest easy-to-use nonparametric survival function matching estimators. These estimators can be used to estimate the time profile of the treatment. We apply one of the estimators to evaluate the effects of an employment subsidies program. The longer run program effects are positive. The estimated time profile suggests locking-in effects while participating in the program and a big upward jump in the employment hazard upon program completion.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1062.

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Length: 39 pages
Date of creation: Mar 2004
Date of revision:
Publication status: published in: Journal of Business and Economics Statistics, 2008, 26 (4), 435–445
Handle: RePEc:iza:izadps:dp1062

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Related research

Keywords: method of matching; dynamic treatment assignment; treatment effects; program evaluation;

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References

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  1. Jaap H. Abbring & Gerard J. van den Berg, 2003. "The Nonparametric Identification of Treatment Effects in Duration Models," Econometrica, Econometric Society, Econometric Society, vol. 71(5), pages 1491-1517, 09.
  2. Rafael Lalive & Jan C. van Ours & Josef Zweimueller, . "The Impact of Active Labor Market Programs on the Duration of Unemployment," IEW - Working Papers 041, Institute for Empirical Research in Economics - University of Zurich.
  3. Per-Anders Edin & Magnus Gustavsson, 2008. "Time out of Work and Skill Depreciation," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 61(2), pages 163-180, January.
  4. Lechner, Michael, 1999. "Earnings and Employment Effects of Continuous Off-the-Job Training in East Germany after Unification," Journal of Business & Economic Statistics, American Statistical Association, American Statistical Association, vol. 17(1), pages 74-90, January.
  5. Michael Gerfin & Michael Lechner, 2002. "A Microeconometric Evaluation of the Active Labour Market Policy in Switzerland," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 112(482), pages 854-893, October.
  6. Forslund, Anders & Johansson, Per & Lindqvist, Linus, 2004. "Employment subsidies - A fast lane from unemployment to work?," Working Paper Series, IFAU - Institute for Evaluation of Labour Market and Education Policy 2004:18, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  7. Carling, Kenneth & Richardson, Katarina, 2001. "The relative efficiency of labor market programs: Swedish experience from the 1990's," Working Paper Series, IFAU - Institute for Evaluation of Labour Market and Education Policy 2001:2, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  8. Fredriksson, Peter & Johansson, Per, 2002. "Program evaluation and random program starts," Working Paper Series, IFAU - Institute for Evaluation of Labour Market and Education Policy 2003:1, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  9. Sianesi, Barbara, 2001. "An evaluation of the active labour market programmes in Sweden," Working Paper Series, IFAU - Institute for Evaluation of Labour Market and Education Policy 2001:5, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  10. Michael Lechner, 2002. "Program Heterogeneity And Propensity Score Matching: An Application To The Evaluation Of Active Labor Market Policies," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 205-220, May.
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