On the inefficiency of propensity score matching
- First Online:
- Cite this article as:
- Frölich, M. AStA (2007) 91: 279. doi:10.1007/s10182-007-0035-0
- 198 Downloads
Propensity score matching is now widely used in empirical applications for estimating treatment effects. Propensity score matching (PSM) is preferred to matching on X because of the lower dimension of the estimation problem. In this note, however, it is shown that PSM is inefficient compared to matching on X. Hence, matching on X should be considered as a serious alternative.