Endog_cens_durat190201JAErevision.pdf (712.96 kB)
Endogenous Censoring in the Mixed Proportional Hazard Model with an Application to Optimal Unemployment Insurance
journal contributionposted on 2019-05-29, 15:07 authored by Arkadiusz Szydlowski
We examine the sensitivity of estimates of the MPH model with respect to assumptions on the censoring mechanism in the context of an economic model of optimal unemployment insurance. We assume a parametric model for the duration of interest and leave the distribution of censoring unrestricted, allowing it to be correlated with observed and unobserved characteristics. We provide a practical characterization of the identified set with moment inequalities and suggest methods for estimating this set. We apply this approach to estimate the elasticity of unemployment exit rate with respect to unemployment benefit. Finally, we investigate welfare consequences of our estimates.
I would like to thank Raj Chetty for sharing his dataset and codes. This research used the ALICE High Performance Computing Facility at the University of Leicester and the Social Sciences Computing Cluster (SSCC) at Northwestern University.
CitationJournal of Applied Econometrics, 2019
Author affiliation/Organisation/COLLEGE OF SOCIAL SCIENCES, ARTS AND HUMANITIES/School of Business
- AM (Accepted Manuscript)