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January 2008 (Springer Verlag)
Article
Dynamic policy analysis
Type: Book Chapters
Authors: Jaap Abbring and James Heckman
Volume, issue, pages: pp. 795-863
Previous version: cemmap Working Papers [Details]
Published in: The Econometrics of Panel Data: Fundamentals and Recent Developments in Theory and Practice

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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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