Statistical matching using propensity scores: Theory and application to the analysis of the distribution of income and wealth

Abstract

This article considers the usefulness of statistical matching using propensity scores in carrying out economic research. We include an application of the procedure to a statistical match between the 2001 Survey of Consumer Finance(SCF) and the 2002 Annual Demographic Supplement (ADS) of the Current Population Survey (CPS) data sets to demonstrate the procedure and results of the matching. Challenges facing the use of this technique such as the distribution of weights are discussed in the conclusion.