title: The Generalized Roy Model and the Cost-Benefit Analysis of Social Programs.
abstract: The literature on treatment effects focuses on gross benefits from program participation. We extend this literature by developing conditions under which it is possible to identify parameters measuring the cost and net surplus from program participation. Using the generalized Roy model, we nonparametrically identify the cost, benefit, and net surplus of selection into treatment without requiring the analyst to have direct information on the cost. We apply our methodology to estimate the gross benefit and net surplus of attending college.
authors.affiliation: The University of Chicago.
authors.forename: Philipp
authors.initials: P
authors.lastname: Eisenhauer
authors.affiliation: The University of Chicago, University College Dublin, American Bar Foundation.
authors.forename: James J
authors.initials: JJ
authors.lastname: Heckman
authors.affiliation: New York University.
authors.forename: Edward
authors.initials: E
authors.lastname: Vytlacil
keywords: Cost-Benefit Analysis; Returns and Costs to Education; Treatment Effects