Sharp Bounds in the Binary Roy Model
Université de Montréal, CIREQ, CIRANO
University of Montreal
May 22, 2012
We derive the empirical content of an instrumental variables model of sectoral choice with binary outcomes. Assumptions on selection include the simple, extended and generalized Roy models. The derived bounds are nonparametric intersection bounds and are simple enough to lend themselves to existing inference methods. Identification implications of exclusion restrictions are also derived.
Number of Pages in PDF File: 34
Keywords: treatment effect, discrete outcomes, sectorial choice, partial identification, intersection bounds
JEL Classification: C21, C25, C26working papers series
Date posted: January 17, 2012 ; Last revised: May 22, 2012
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