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Dynamic policy analysis

  • Jaap Abbring

    (Institute for Fiscal Studies and Tinbergen Institute)

  • James Heckman

    (Institute for Fiscal Studies and University of Chicago)

This chapter studies the microeconometric treatment-effect and structural approaches to dynamic policy evaluation. First, we discuss a reduced-form approach based on a sequential randomization or dynamic matching assumption that is popular in biostatistics. We then discuss two complementary approaches for treatments that are single stopping times and that allow for non- trivial dynamic selection on unobservables. The first builds on continuous-time duration and event-history models. The second extends the discrete-time dynamic discrete-choice literature.

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File URL: http://cemmap.ifs.org.uk/wps/cwp508.pdf
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Paper provided by Centre for Microdata Methods and Practice, Institute for Fiscal Studies in its series CeMMAP working papers with number CWP05/08.

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Date of creation: Feb 2008
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Handle: RePEc:ifs:cemmap:05/08
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