Working Paper Series
IFAU - Institute for Evaluation of Labour Market and Education Policy
Monica Costa Dias, Hidehiko Ichimura and Gerard J. van den Berg
The matching method for treatment evaluation with selective participation and ineligibles
Abstract: The matching method for treatment evaluation does not
balance selective unobserved differences between treated and non-treated.
We derive a simple correction term if there is an instrument that shifts
the treatment probability to zero in specific cases. Policies with
eligibility restrictions, where treatment is impossible if some variable
exceeds a certain value, provide a natural application. In an empirical
analysis, we first examine the performance of matching versus
regression-discontinuity estimation in the sharp age-discontinuity design
of the NDYP job search assistance program for young unemployed in the UK.
Next, we exploit the age eligibility restriction in the Swedish Youth
Practice subsidized work program for young unemployed, where compliance is
imperfect among the young. Adjusting the matching estimator for selectivity
changes the results towards inefectiveness of subsidized work in moving
individuals into employment.
Keywords: Propensity score; policy evaluation; treatment effect; regression discontinuity; selection; job search assistance; subsidized work; youth unemployment; (follow links to similar papers)
JEL-Codes: C14; C25; J64; (follow links to similar papers)
36 pages, April 21, 2008
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