Unordered Monotonicity

49 Pages Posted: 12 Jul 2017

See all articles by James J. Heckman

James J. Heckman

University of Chicago - Department of Economics; National Bureau of Economic Research (NBER); American Bar Foundation; Institute for the Study of Labor (IZA); CESifo (Center for Economic Studies and Ifo Institute)

Rodrigo R. Pinto

University of Chicago - Department of Economics

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Date Written: June 2017

Abstract

This paper defines and analyzes a new monotonicity condition for the identification of counterfactuals and treatment effects in unordered discrete choice models with multiple treatments, heterogenous agents and discrete-valued instruments. Unordered monotonicity implies and is implied by additive separability of choice of treatment equations in terms of observed and unobserved variables. These results follow from properties of binary matrices developed in this paper. We investigate conditions under which unordered monotonicity arises as a consequence of choice behavior. We characterize IV estimators of counterfactuals as solutions to discrete mixture problems.

Suggested Citation

Heckman, James J. and Pinto, Rodrigo R., Unordered Monotonicity (June 2017). NBER Working Paper No. w23497. Available at SSRN: https://ssrn.com/abstract=2992406

James J. Heckman (Contact Author)

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Rodrigo R. Pinto

University of Chicago - Department of Economics ( email )

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Chicago, IL 60637
United States

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