Evaluation of the Australian Wage Subsidy Special Youth ...

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The distribution of the propensity scores is shown using the histogram in Figure 6.4;
kernel density plots of the propensities before matching are shown in Figure 6.6. The
statistics summarizing the distribution of the new propensity scores are also shown in
Table 6.5 for both the comparison group and SYETP participants. The weighted
propensity distributions, when compared to the unweighted shown previously in Figures
4.3, 4.4 and Table 4.5, do not appear very much altered by the application of the weights.
However, the distributions have had slight changes. The SYETP propensities have grown
slightly at the upper end, with the largest cases greater in size than when unweighted,
while at the lower end of the distribution the smallest cases have shrunk in size. The
median is roughly the same as when unweighted, but the mean propensity is now slightly
larger. For the comparison group of nonparticipants, it is also true that the tails have been
slightly altered, with the largest cases greater in size than when unweighted, and the
smallest cases smaller than when unweighted. However, the mean and median of the
comparisons are largely unaffected by the introduction of weighting.
Comparison with the former unweighted propensity scores shows only very small change.
The propensities still have good properties, in that the distributions overlap, and the range
of the distributions gives a probability roughly from zero up to 0.5 for both treated and
comparisons. The kernel density mapping doesn’t look too different to that of the
unweighted propensity model. A result of the new weighted propensity scores is that now
the application of the common support condition leads to one case being dropped from
the SYETP group, the SYETP case with the largest propensity score value. The
implication is that for that SYETP case, there was no comparison case which had a
propensity score this high. Indeed the distributions shown in the histogram and kernel
density plot indicate most comparison cases had near-zero propensity values.
The matching results are shown in the Table 6.7, where the PSM implemented was single
nearest –neighbour –with replacement, within-caliper, with the additional protocol of
weighting the propensity with survey weights for attrition. Comparison with the former
results shows that the weighting has led to much smaller results for the employment
effect. The statistical significance of the employment effects is also low. Although