Microeconometric Evaluation and the Selection Bias – A practical Survey of Nonparametrical Solution Methods

The application of evaluation strategies becomes more important in various fields of study. The problem of self-selection associated with microeconomic evaluation can be solved in different ways, but nonparametrical solutions are most popular. The study gives an overview of nonparametrical solution methods for this problem. The aim is to close the gap between introductory and the more sophisticated literature and to give some practical guidance for the choice of the appropriate method for empirical application. The assumptions as well as advantages and drawbacks for empirical application and the requirements to the data base are described for every approach. It becomes clear that there is no ‘magic bullet’. For an unbiased estimation the assumptions have to be fulfilled and the data at hand must be compatible with the respective method.

27. October 2006

Authors Eva Reinowski

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