October 2018

IZA DP No. 11914: An Introduction to Nonparametric Regression for Labor Economists

Daniel J. Henderson, Anne-Charlotte Souto

published in: Journal of Labor Research, 2018, 39, 355-382

In this article we overview nonparametric (spline and kernel) regression methods and illustrate how they may be used in labor economic applications. We focus our attention on issues commonly found in the labor literature such as how to account for endogeneity via instrumental variables in a nonparametric setting. We showcase these methods via data from the Current Population Survey.