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Bounds On Treatment Effects On Transitions

Author

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  • Ridder, Geert

    () (University of Southern California,)

  • Vikström, Johan

    () (Uppsala Center for Labor Studies)

Abstract

This paper considers the definition and identification of treatment effects on conditional transition probabilities. We show that even under sequential random assignment only the instantaneous average treatment effect is point identified. Because treated and control units drop out at different rates, randomization only ensures the comparability of treatment and controls at the time of randomization, so that long run average treatment effects are not point identified. Instead we derive informative bounds on these average treatment effects. Our bounds do not impose (semi)parametric restrictions, as e.g. proportional hazards, that would narrow the bounds or even allow for point identification. We also explore various assumptions such as monotone treatment response, common shocks and positively correlated outcomes.

Suggested Citation

  • Ridder, Geert & Vikström, Johan, 2011. "Bounds On Treatment Effects On Transitions," Working Paper Series, Center for Labor Studies 2011:3, Uppsala University, Department of Economics.
  • Handle: RePEc:hhs:uulswp:2011_003
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    File URL: http://www.ucls.nek.uu.se/digitalAssets/136/136494_20113.pdf
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    References listed on IDEAS

    as
    1. Fredriksson, Peter & Johansson, Per, 2008. "Dynamic Treatment Assignment," Journal of Business & Economic Statistics, American Statistical Association, vol. 26, pages 435-445.
    2. Charles F. Manski & John V. Pepper, 2000. "Monotone Instrumental Variables, with an Application to the Returns to Schooling," Econometrica, Econometric Society, vol. 68(4), pages 997-1012, July.
    3. Liliane Bonnal & Denis Fougère & Anne Sérandon, 1997. "Evaluating the Impact of French Employment Policies on Individual Labour Market Histories," Review of Economic Studies, Oxford University Press, vol. 64(4), pages 683-713.
    4. Ridder, G, 1986. "An Event History Approach to the Evaluation of Training, Recruitment and Employment Programmes," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 1(2), pages 109-126, April.
    5. Chris Elbers & Geert Ridder, 1982. "True and Spurious Duration Dependence: The Identifiability of the Proportional Hazard Model," Review of Economic Studies, Oxford University Press, vol. 49(3), pages 403-409.
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    Citations

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    Cited by:

    1. Vikström, Johan & Rosholm, Michael & Svarer, Michael, 2013. "The effectiveness of active labor market policies: Evidence from a social experiment using non-parametric bounds," Labour Economics, Elsevier, vol. 24(C), pages 58-67.
    2. Le Barbanchon, Thomas, 2016. "The effect of the potential duration of unemployment benefits on unemployment exits to work and match quality in France," Labour Economics, Elsevier, vol. 42(C), pages 16-29.
    3. Vikström, Johan & Rosholm, Michael & Svarer, Michael, 2011. "The relative efficiency of active labour market policy: evidence from a social experiment and non-parametric methods," Working Paper Series 2011:7, IFAU - Institute for Evaluation of Labour Market and Education Policy.

    More about this item

    Keywords

    Partial identification; duration model; randomized experiment; treatment effect;

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies

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