Title:Health status and labour market outcome: empirical evidence from Australia
Lecturer:Prof.Xueyan Zhao from Monash University
Time:6.21 AM10:00
Location:New Main Building A1048
Abstract:This paper examines the notion of "identification by functional form" for binary outcome and binary treatment models by providing a bridge between the literature on the recursive bivariate probit (RBVP) model and that on partial identification. We evaluate the impact of functional form specification on the performance of maximum likelihood estimators and quasi maximum likelihood estimators (QMLE) based upon the RBVP model, and we also investigate the practical importance of available instruments in both cases of correct and incorrect distributional specifications. We find a “compensating effect” so that the QMLE based upon grossly misspecified RBVP perform well for ATE estimates. Finally, we calculate ATE bounds previously derived by Chesher and use these to demonstrate how the properties of the QMLE estimator are explicable via a link between the notion of pseudo-true parameter values and the concepts of partial identification. We conclude that RBVP model can be a robust and useful tool in empirical analyses especially in the calculation of ATE bounds.
