Tuesday, August 26, 2014

Learning about what observed variables you need for selection on observed variables to be a reasonable assumption

I like this paper a lot, both in the narrow sense that it presents interesting and useful results that I have already been citing, but also more generally because it follows the path that I think the literature should follow but rarely does. That path takes claims about the important of selection on unobserved variables in particular contexts and puts them to an empirical test.

Marco Caliendo, Robert Mahlstedt, Oscar A. Mitnik:

Unobservable, but Unimportant? The Influence of Personality Traits (and Other Usually Unobserved Variables) for the Evaluation of Labor Market Policies

Many commonly used treatment effects estimators rely on the unconfoundedness assumption ("selection on observables") which is fundamentally non-testable. When evaluating the effects of labor market policies, researchers need to observe variables that affect both treatment participation and labor market outcomes. Even though in many countries it is possible to access (very) informative administrative data, concerns about the validity of the unconfoundedness assumption remain. The main concern is that the observed characteristics of the individuals may not be enough to properly address potential selection bias. This is especially relevant in light of the research on the influence of personality traits and attitudes on economic outcomes. We exploit a unique dataset that contains a rich set of administrative information on individuals entering unemployment in Germany, as well as several usually unobserved characteristics like personality traits, attitudes, expectations, and job search behavior. This allows us to empirically assess how estimators based on the unconfoundedness assumption perform when alternatively including or not these usually unobserved variables. Our findings indicate that these variables play a significant role for selection into treatment and labor market outcomes, but do not make for the most part a significant difference in the estimation of treatment effects, compared to specifications that include detailed labor market histories. This suggests that rich administrative data may be good enough to draw policy conclusions on the effectiveness of active labor market policies.


Monday, August 25, 2014

The neighborhood lawsuit

The lawsuit described in this astounding Ann Arbor Observer article took place over access to a path in my neighborhood.

Wow. All those lawyer fees could have made for some block party. Or maybe some big notation to a more deserving group?

Full disclosure: we don't know any of the parties to the suit very well, but know the folks who shut down the trail better.

Friday, August 22, 2014

Michigan to play Washington in college football

This will be fun! Stories from a Michigan blog and from the Seattle Times.

The Michigan blogger neglects to note that Washington would have won the last match in the big house had Slick Rick not blown the clock management.

Hat tip: Jeremy Fox

Monday, August 18, 2014

Humans need not apply

An over-the-top but still interesting and entertaining video about capital-labor substitution.

The video does overstate the case: in recent decades the labor market managed to absorb all the folks who used to farm as well as large numbers of assembly-line workers, keypunch operators and the like. I think the takeaway is more about the value of general skills (e.g. how not to be a jerk, how to show up on time, how to manage) than about a future with no work.

Hat tip: Dan Black

Saturday, August 16, 2014

Killewald and Gough

Two sociology students from Michigan foolish and/or bold enough to have me on their committees (and now on to careers in academia) have won a best paper award of the American Sociological Association section on the family.


Friday, August 15, 2014

Ann Arbor history: streetcars

The Ann Arbor News on Ann Arbor's history of streetcars. I was surprised by the extensiveness of the streetcar network.

Thursday, August 14, 2014

An old mystery solved: My Sharona

I probably should have sorted this out a long time ago, but it turns out there actually is a person called Sharona behind the Knack hit song "My Sharona". Perhaps not overly surprisingly, she now sells real estate in Los Angeles. You can see the (SFW) single cover featuring Sharona here.

I saw the Knack in concert back when I was in high school. People thought (and wrote - I wish I still had the Seattle Times concert review) they were going to be the next Beatles. To encourage such thinking, they performed "Hard Days Night" as their encore. As it turned out, they fizzled after their second album.