Central to the welfare analysis of income transfer programs is deadweight loss associated with possible reforms. To aid analytical tractability, its measurement typically requires specifying a simplified model behavior. We employ complementary “decomposition” approach that compares behavioral and mechanical components policy’s total impact on government budget study two unemployment insurance p...

We review and complement a general approach for Monte Carlo computations of conditional expectations given a sufficient statistic. The problem of direct sampling from the conditional distribution is considered in particular. This can be done by a simple parameter adjustment of the original statistical model if certain conditions are satisfied, but in general one needs to use a weighted sampling...

Given a large dataset and an estimation task, it is common to pre-process the data by reducing them to a set of sufficient statistics. This step is often regarded as straightforward and advantageous (in that it simplifies statistical analysis). I show that –on the contrary– reducing data to sufficient statistics can change a computationally tractable estimation problem into an intractable one. ...