Dynamic Discrete Choice and Dynamic Treatment Effects

96 Pages Posted: 18 Oct 2005

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)

Salvador Navarro-Lozano

University of Chicago - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: October 2005

Abstract

This paper considers semiparametric identification of structural dynamic discrete choice models and models for dynamic treatment effects. Time to treatment and counterfactual outcomes associated with treatment times are jointly analyzed. We examine the implicit assumptions of the dynamic treatment model using the structural model as a benchmark. For the structural model we show the gains from using cross equation restrictions connecting choices to associated measurements and outcomes. In the dynamic discrete choice model, we identify both subjective and objective outcomes, distinguishing ex post and ex ante outcomes. We show how to identify agent information sets.

Keywords: dynamic treatment effects, dynamic discrete choice, semiparametric identification

JEL Classification: C31

Suggested Citation

Heckman, James J. and Navarro-Lozano, Salvador, Dynamic Discrete Choice and Dynamic Treatment Effects (October 2005). IZA Discussion Paper No. 1790. Available at SSRN: https://ssrn.com/abstract=826452

James J. Heckman (Contact Author)

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Salvador Navarro-Lozano

University of Chicago - Department of Economics ( email )

1126 East 59th Street
Chicago, IL 60637
United States

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