Job Displacement of Older Workers during the Great Recession: Tight Bounds on Distributional Treatment Effect Parameters using Panel Data

• Departmental Seminar

Date and Location

Monday, January 25, 2016, 11:00 AM - 12:30 PM
ARE Library Conference Room, 4101 Social Sciences and Humanities

Abstract

Older workers who were displaced during the Great Recession lost on average 40% of their earnings relative to their counterfactual earnings had they not been displaced. But the average effect masks substantial heterogeneity across workers. This paper develops new techniques to bound distributional treatment effect parameters that depend on the joint distribution of potential outcomes – an object not identified by standard identifying assumptions such as selection on observables or even when treatment is randomly assigned. I show that panel data and an additional assumption on the dependence between untreated potential outcomes for the treated group over time (i) provide more identifying power for distributional treatment effect parameters than existing bounds and (ii) provide a more plausible set of conditions than existing methods that obtain point identification.