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IPSS Selection/ Switching

IPSS Selection/ Switching. Outcome: y. Treatment: z. censored. P(y 0 ∈ B|x,z 0 ). z=0. P(y 1 ∈ B | x,z 0 ). Selection. P(y 0 ∈ B | x,z 1 ). z=1. P(y 1 ∈ B | x,z 1 ). IPSS Selection/ Switching. IPSS Selection/ Switching. IPSS Selection/ Switching. z=1 work. z=0 non-work. wage.

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IPSS Selection/ Switching

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  1. IPSS Selection/ Switching Outcome: y Treatment: z censored P(y0∈B|x,z0) z=0 P(y1∈B | x,z0) Selection P(y0∈B | x,z1) z=1 P(y1∈B | x,z1)

  2. IPSS Selection/ Switching

  3. IPSS Selection/ Switching

  4. IPSS Selection/ Switching z=1 work z=0 non-work wage Reservation wage

  5. IPSS Selection/ Switching

  6. IPSS Selection/ Switching P(y1<t|x,z0) < P(y0<t|x,z0) y0 y1 t y

  7. IPSS Selection/ Switching

  8. IPSS Selection/ Switching

  9. IPSS Selection/ Switching If z=1 then it has to be true P(y0>t|x,z1) < P(y1> t|x,z1) y0 y1 t y

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