A Primer for Applying Propensity-Score Matching
The use of microeconometric techniques to estimate the effects of development policies has become a common approach not only for scholars, but also for policy-makers engaged in designing, implementing and evaluating projects in different fields. Among these techniques, Propensity-Score Matching (PSM) is increasingly applied in the policy evaluation community. This technical note provides a guide to the key aspects of implementing PSM methodology for an audience of practitioners interested in understanding its applicability to specific evaluation problems. The note summarizes the basic conditions under which PSM can be used to estimate the impact of a program and the data required. It explains how the Conditional Independence Assumption, combined with the Overlap Condition, reduces selection bias when participation in a program is determined by observable characteristics. It also describes different matching algorithms and some tests to assess the quality of the matching. Case studies are used throughout to illustrate important concepts in impact evaluation and PSM. In the annexes, the note provides an outline of the main technical aspects and a list of statistical and econometric software for implementing PSM.
|Date of creation:||Aug 2010|
|Contact details of provider:|| Postal: 1300 New York Avenue, NW, Washington, DC 20577|
Web page: http://www.iadb.org/spd
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:idb:spdwps:1005. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Monica Bazan)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.