Evaluating Search and Matching Models Using Experimental Data

Jeremy Lise, Shannon Seitz () and Jeffrey Smith

No 1717, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper introduces an innovative test of search and matching models using the exogenous variation available in experimental data. We take an off-the-shelf Pissarides matching model and calibrate it to data on the control group from a randomized social experiment. We then simulate a program group from a randomized experiment within the model. As a measure of the performance of the model, we compare the outcomes of the program groups from the model and from the randomized experiment. We illustrate our methodology using the Canadian Self-Sufficiency Project (SSP), a social experiment providing a time limited earnings supplement for Income Assistance recipients who obtain full time employment within a 12 month period. We find two features of the model are consistent with the experimental results: endogenous search intensity and exogenous job destruction. We find mixed evidence in support of the assumption of fixed hours of labor supply. Finally, we find a constant job destruction rate is not consistent with the experimental data in this context.

Keywords: calibration; equilibrium search and matching models; policy experiments; Self-Sufficiency Project; welfare; social experiments (search for similar items in EconPapers)
JEL-codes: I38 J2 J6 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2005-08
New Economics Papers: this item is included in nep-dge and nep-exp
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Published - published in: IZA Journal of Labor Economics, 2015, 4:16

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Related works:
Journal Article: Evaluating search and matching models using experimental data (2015)
Working Paper: Evaluating Search And Matching Models Using Experimental Data (2006)
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