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Programme Heterogeneity and Propensity Score Matching: An Application to the Evaluation of Active Labour Market Policies


  • Michael Lechner

    (University of St. Gallen)


This paper investigates the question whether it really matters for microeconometric evaluation studies to take account of the fact that the programmes under consideration are heterogeneous. Assuming that selection into the different sub-programmes and the potential outcomes are independent given observable characteristics, estimators based on different propensity scores are compared and applied to the analysis of the active labour market policy in a Swiss region. Furthermore, the issues of heterogeneous effects and aggregation are addressed. The econometric considerations as well as the results of the application suggest that an approach that incorporates the possibility of having multiple programmes could be an important tool in applied work.

Suggested Citation

  • Michael Lechner, 2000. "Programme Heterogeneity and Propensity Score Matching: An Application to the Evaluation of Active Labour Market Policies," Econometric Society World Congress 2000 Contributed Papers 0647, Econometric Society.
  • Handle: RePEc:ecm:wc2000:0647

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    References listed on IDEAS

    1. McFadden, Daniel L., 1984. "Econometric analysis of qualitative response models," Handbook of Econometrics,in: Z. Griliches† & M. D. Intriligator (ed.), Handbook of Econometrics, edition 1, volume 2, chapter 24, pages 1395-1457 Elsevier.
    2. Angrist, Joshua D. & Krueger, Alan B., 1999. "Empirical strategies in labor economics," Handbook of Labor Economics,in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 23, pages 1277-1366 Elsevier.
    3. Geweke, John & Keane, Michael P & Runkle, David, 1994. "Alternative Computational Approaches to Inference in the Multinomial Probit Model," The Review of Economics and Statistics, MIT Press, vol. 76(4), pages 609-632, November.
    4. Lechner, Michael, 1999. "Identification and Estimation of Causal Effects of Multiple Treatments Under the Conditional Independence Assumption," IZA Discussion Papers 91, Institute for the Study of Labor (IZA).
    5. Borsch-Supan, Axel & Hajivassiliou, Vassilis A., 1993. "Smooth unbiased multivariate probability simulators for maximum likelihood estimation of limited dependent variable models," Journal of Econometrics, Elsevier, vol. 58(3), pages 347-368, August.
    6. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics,in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097 Elsevier.
    7. Guido W. Imbens, 1999. "The Role of the Propensity Score in Estimating Dose-Response Functions," NBER Technical Working Papers 0237, National Bureau of Economic Research, Inc.
    8. 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, vol. 17(1), pages 74-90, January.
    9. Joshua D. Angrist, 1998. "Estimating the Labor Market Impact of Voluntary Military Service Using Social Security Data on Military Applicants," Econometrica, Econometric Society, vol. 66(2), pages 249-288, March.
    10. A. D. Roy, 1951. "Some Thoughts On The Distribution Of Earnings," Oxford Economic Papers, Oxford University Press, vol. 3(2), pages 135-146.
    11. James J. Heckman & Hidehiko Ichimura & Petra Todd, 1998. "Matching As An Econometric Evaluation Estimator," Review of Economic Studies, Oxford University Press, vol. 65(2), pages 261-294.
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    Cited by:

    1. Gerfin, Michael & Lechner, Michael & Steiger, Heidi, 2005. "Does subsidised temporary employment get the unemployed back to work? Aneconometric analysis of two different schemes," Labour Economics, Elsevier, vol. 12(6), pages 807-835, December.
    2. Lechner, Michael & Wunsch, Conny, 2006. "Active Labour Market Policy in East Germany: Waiting for the Economy to Take Off," CEPR Discussion Papers 5924, C.E.P.R. Discussion Papers.
    3. Fabrice Gilles, 2006. "Quels effets des réorganisations sur la date de passage aux 35 heures ?. Une étude sur données individuelles d'entreprises," Revue économique, Presses de Sciences-Po, vol. 57(6), pages 1401-1425.
    4. Michael Lechner & Ruth Miquel & Conny Wunsch, 2007. "The Curse and Blessing of Training the Unemployed in a Changing Economy: The Case of East Germany After Unification," German Economic Review, Verein für Socialpolitik, vol. 8, pages 468-509, November.
    5. Michael Lechner, 2004. "Sequential Matching Estimation of Dynamic Causal Models," University of St. Gallen Department of Economics working paper series 2004 2004-06, Department of Economics, University of St. Gallen.
    6. Michael Lechner & Ruth Miquel & Conny Wunsch, 2011. "Long‐Run Effects Of Public Sector Sponsored Training In West Germany," Journal of the European Economic Association, European Economic Association, vol. 9(4), pages 742-784, August.
    7. Michael Gerfin & Michael Lechner, 2002. "A Microeconometric Evaluation of the Active Labour Market Policy in Switzerland," Economic Journal, Royal Economic Society, vol. 112(482), pages 854-893, October.
    8. Fredriksson, Peter & Johansson, Per, 2002. "Program Evaluation and Random Program Starts," Working Paper Series 2003:1, Uppsala University, Department of Economics.
    9. Raaum, Oddbjørn & Torp, Hege & Zhang, Tao, 2003. "Business cycles and the impact of labour market programmes," Memorandum 14/2002, Oslo University, Department of Economics.
    10. Rosemarie Bégin & Lota D. Tamini & Maurice Doyon, 2014. "L'effet du travail hors-ferme sur l'efficacité technique des fermes laitières québécoises: un modèle intégrant les biais de sélection sur les observables et inobservables," Cahiers de recherche CREATE 2014-9, CREATE.
    11. Markus Frölich & Almas Heshmati & Michael Lechner, 2004. "A microeconometric evaluation of rehabilitation of long-term sickness in Sweden," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 19(3), pages 375-396.
    12. Huber, Martin & Lechner, Michael & Walter, Thomas & Wunsch, Conny, 2009. "Do German Welfare-to-Work Programmes Reduce Welfare and Increase Work?," CEPR Discussion Papers 7238, C.E.P.R. Discussion Papers.
    13. Lorena Alcázar & Eduardo Nakasone & Máximo Torero, 2007. "Provision of Public Services and Welfare of the Poor: Learning from an Incomplete Electricity Privatization Process in Rural Peru," IDB Publications (Working Papers) 3351, Inter-American Development Bank.
    14. FLORES-LAGUNES Alfonso & CHOE Chung & LEE Sang-Jun, 2011. "Do Dropouts Benefit from Training Programs? Korean Evidence Employing Methods for Continuous Treatments," LISER Working Paper Series 2011-34, LISER.
    15. Juan Díaz & Miguel Jaramillo, 2006. "An Evaluation of the Peruvian "Youth Labor Training Program"-PROJOVEN," OVE Working Papers 1006, Inter-American Development Bank, Office of Evaluation and Oversight (OVE).
    16. Helland, Eric & Tabarrok, Alexander, 2004. "The Fugitive: Evidence on Public versus Private Law Enforcement from Bail Jumping," Journal of Law and Economics, University of Chicago Press, vol. 47(1), pages 93-122, April.
    17. Michael Lechner & Ruth Miquel, 2010. "Identification of the effects of dynamic treatments by sequential conditional independence assumptions," Empirical Economics, Springer, vol. 39(1), pages 111-137, August.
    18. Máximo Torero & Lorena Alcazar & Eduardo Nakasone, 2007. "El suministro de servicios públicos y bienestar social para los pobres. Aprendizaje de la privatización incompleta del sector eléctrico en Perú," Research Department Publications 3233, Inter-American Development Bank, Research Department.
    19. Lechner, Michael & Gerfin, Michael, 2000. "Wirkung der aktiven Arbeitsmarktpolitik der Schweiz auf die individuellen Beschäftigungschancen von Arbeitslosen (Effect of active labour market policy in Switzerland on the individual employment pros," Mitteilungen aus der Arbeitsmarkt- und Berufsforschung, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 33(3), pages 396-404.
    20. Hujer, Reinhard & Wellner, Marc, 2000. "The Effects of Public Sector Sponsored Training on Individual Employment Performance in East Germany," IZA Discussion Papers 141, Institute for the Study of Labor (IZA).
    21. repec:iab:iabmit:v:33:i:3:p:396-404 is not listed on IDEAS
    22. Raaum, Oddbjørn & Torp, Hege & Zhang, Tao, 2003. "Do individual programme effects exceed the costs? Norwegian evidence on long run effects of labour market training," Memorandum 15/2002, Oslo University, Department of Economics.
    23. Gerfin, Michael & Lechner, Michael, 2001. "A Microeconometric Evaluation of Active Labour Market Policy in Switzerland," CEPR Discussion Papers 2993, C.E.P.R. Discussion Papers.

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