1. Identification and Estimation of Intensive Margin Effects by Difference-in-Difference Methods
- Author
-
Hersche Markus and Moor Elias
- Subjects
intensive margin effect ,difference-in-difference ,corner solutions ,policy evaluation ,62d20 ,62p20 ,Mathematics ,QA1-939 ,Probabilities. Mathematical statistics ,QA273-280 - Abstract
This paper discusses identification and estimation of causal intensive margin effects. The causal intensive margin effect is defined as the treatment effect on the outcome of individuals with a positive outcome irrespective of whether they are treated or not, and is of interest for outcomes with corner solutions. The main issue is to deal with a potential selection problem that arises when conditioning on positive outcomes. We propose using difference-in-difference methods - conditional on positive outcomes - to estimate causal intensive margin effects. We derive sufficient conditions under which the difference-in-difference estimator identifies the causal intensive margin effect. We apply the methodology to estimate the causal intensive margin effect of reaching the full retirement age on working hours.
- Published
- 2020
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