Microeconometrics

Course Information

• Language: The course is taught in English and open to Diploma and IMP students. 
• Credit points: Lecture (2 SWS) plus PC Tutorial (1 SWS) gives 4 credit points.
• Exam: Monday, July 25, 2011, 09:00-11:00, HS 2006.
• Retake exam: October 10, 2011, 09:00-11:00, HS 2004.
  

Course Description

The course aims to provide participants with fundamental knowledge of estimation techniques frequently used in applied microeconomic research. The course will focus on endogeneity issues and evaluation methods such as social, natural, and quasi experiments. The course prerequisites are Mathematics, Statistics, and Econometrics (OLS). Students will learn to implement the estimation techniques in PC-sessions using the econometric package TSP.

Instructors

Lecture:	PD Dr. Alexander Spermann
	Randstad Deutschland
	Email:

Tutorial:	Ute Leuschner
	Email:

Topics and Dates

Course Material

Topic 6: Natural Field Experiments

• Please read: Armin Falk and J.J Heckman (2009). Lab Experiments are a Major Source of Knowledge in the Social Sciencies. IZA Discussion Paper Nr. 4540
• Please read: Del Mer, S., D. McKenzie, and C. Woodruff (2010). Field Experiments in Firms. Wage Subsidies in Microenterprises. AER: Papers and Proceedings 100, p. 614-618. Here
• Please read: Roland G. Fryer, Jr. (2010). Financial Incentives and Student Achievement: Evidence from Ranomized Trials. NBER Working Paper Nr. 15898. Here
• Please read: Steven D. Levit and J. A List (2008). Field Experiments in Economics: The Past, the Present, and the Future. NBER Working Paper Nr. 14356. Here
• Please read: De silva, D. G. et. al (2010). The Effect of Migration on Wages . Evidence from a Natural Experiment. AER: Papers and Proceedings 100, p. 321-326. Here
• Please read: Spiegel Artikel (2009). Here
• Please read: The Economist, May 22nd 2010. Here

Topic 5: Natural Experiments: Instrumental Variables

• Lecture slides:
  
• IV Estimation.
  
• Read: Puhani, P.A., and A.M. Weber (2007). Does the early bird catch the worm? Instrumental variable estimates of early educational effects of age of school entry in Germany. Empirical Economics, 32, 359-386. Here
• Read: Economics Focus: Cause and Defect. Here
• Read: Angrist, J.D. and j. Pischke (2010). The Credibility Revolution in Empirical Economics:How Better Research Design Is Taking the Con out of Econometrics. IZA Discussion Paper No. 4800
• Read: Heckman, J.J. and S. Urzua (2009). Comparing IV with Structural Models: What Simple IV Can and Cannot Identify. IZA Discussion Paper No. 3980

• Materials for tutorial: Problem Set 5

Topic 4: Natural Experiments: Diff-in-Diff Estimation

• Lecture slides:
  
• Case Study Minimum Wage; Solution the Evaluation Problem: Trilogy.
  
• Read: Caliendo, Hujer (2005) The Microeconometric Estimation of Treatment Effects - An Overview. IZA Discussion Paper No. 1653
  Read pp. 21-25 from the book or chapter 3.5 in the discussion paper!
• Please read: Ashenfelter, O.C, H. Farber, and M.R. Ransom (2010). Modern Models of Monopsony in Labor Markets: A Brief Survey. IZA Discussion Paper No. 4915
• Please read: Müller, K. and V. Steiner (2010). Labor Market and Income Effects of a Legal Minimum Wage in Germany. IZA Discussion Paper No. 4929.

• Materials for tutorial: Problem Set 4
  

Topic 3: Matching

• Lecture slides: Matching;
• Application: Job Placement Vouchers
• Application 1: Winterhager, H., A. Heinze and A. Spermann (2006). Deregulating Job Placement in Europe: A Microeconometric Evaluation of an Innovative Voucher Scheme in Germany. Labor Economics Vol. 13, pp. 505-517. IZA Discussion Paper No. 2109. Here
• Application 2: Cameron, A. and P. Trivedi (2005). Microeconometrics. pp. 889-898 (available in the Semesterapparat).
• Application 3: Altonji, J.G., T.E. Elder and C.R. Taber (2008). Using Selection on Observed Variables to Assess Bias from Unobservables when Evaluating Swan-Ganz Catheterization. American Economic Review, 98(2), pp. 345-350. Here
• Materials for tutorial: Problem Set 3

Topic 2: Social- and Quasi Experimenets

• Lecture slides: Probit and ATE, Social Experiments, Case Study (Long-Term Care)
• Arntz, M. and S.L. Thomsen (2008). Reforming Home Care Provision in  Germany - Evidence from a Social Experiment. ZEW Discussion Paper 08-114. Here
• Arntz, M. and S.L. Thomsen (2008). Crowding out Informal Care? Evidence form a Social experiment in Germany. ZEW Discussion Paper 08-113. Here
• Spermann, A. and H. Strotmann (2005). The Targeted Negative Income Tax (TNIT) in Germany: Evidence from a Quasi-Experiment. ZEW Discussion Paper 05-68. Here
• Materials for tutorial: Problem Set 2
  

Topic 1: Introduction to Microeconometrics and the Fundamental Evaluation Problem

• Lecture slides: Introduction to Microeconometrics, The Evaluation Problem

• Verbeek, M. (2008). A Guide to Modern Econometrics. Read Chapter 5, in particular sections 5.2.3 and 5.2.4 (available in the Semesterapparat).
• Hagen, T. and B. Fitzenberger (2004). Mikroökonometrische Methoden zur Ex-Post-Evaluation. in Hagen, T. and A. Spermann Hartz-Gesetze - Methodische Ansätze zu einer Evaluierung, ZEW Wirtschaftsanalysen 74, S. 45-72 (available in the Semesterapparat)
• Caliendo, M. (2006). Microeconometric Evaluation of Labor Market Policies. Read Chapter 1 (available in the Semesterapparat).
• Börsch-Supan, A. and J. Köke (2002). An Applied Econometricians' View on Empirical Corporate Governance Studies. German Economic Review, 3(3) pp. 295-326. Here
• Materials for tutorial: Introduction to TSP, Problem Set 1, ME_Probit
  

Foundations for using TSP

• TSP User's Guide
• TSP Reference Manual
• The most important TSP commands (in German; for English see the above links).

General reading for the course

• Caliendo, Marco (2006). Microeconometric Evaluation of Labor Market Policies.Springer, Berlin.

Supplementary references

• Angrist, Joshua D. and Jörn-Steffen Pischke (2009). Mostly Harmless Econometrics. Prienston University Press, New Jersey.
• Boeri, Tito and Jan van Ours (2008). The Economics of Imperfect Labor Markets.Prienston University Press, New Jersey.
• Verbeek, Marno (2008). A Guide to Modern Econometrics. 3rd ed., John Wiley, Chichester.

Econometric readings

• Cameron, Adrian Colin and Pravin K. Trivedi (2005). Microeconometrics. Methods and Applications. Cambridge University Press.
• Dougherty, Christopher (2006). Introduction to Econometrics. 3rd ed., Oxford University Press.
• Gujarati, Damodar (2002). Basic Econometrics. 4th ed., McGraw-Hill.
• Wooldridge, Jeffrey (2006). Introductory Econometrics: A Modern Approach. Cincinnati, OH: South-Western College Publishing, 3rd ed.

Mathematical foundations

• Chiang, Alpha C. and Kevin Wainwright (2005). Fundamental Methods of Mathematical Economics. 4th ed., McGraw-Hill.
• Hoy, Michael et al. (2001). Mathematics for Economics. MIT Press.