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mvpfDE

This is a implementation of the "Marginal Value of Public Funds" Methodology for Germany. See https://github.com/OpportunityInsights/welfare_analysis or their paper Hendren & Sprung-Keyser (2020): A Unified Welfare Analysis of Government Policies - Quarterly Journal of Economics 2020

How to generate results & modify the assumptions:

Download the repository, open the main.R file and update the the working directory to point to the project folder. That's the folder where the main.R file is located. Assumptions and some general settings can be set in assumptions.R. Running the R code inside main.R runs all the programs, performs the bootstrap and exports plots to the plots folder.

How to add an additional reform:

Each reform or government policy needs to have an identifier, i.e. an unique name. To add a new reform, two files and a folder have to created:

  1. Create a new folder in the programs directory named after the identifier
  2. Copy the exampleProgram.R file from the sample_files folder to the created directory and rename it to WhateverTheIdentifierIs.R This file contains all the logic necesarry to calculate the MVPF. All of these .R files follow the same pattern. Read the explanation in exampleProgram.R for further details.
  3. Add a .xlsx excel file named WhateverTheIdentifierIs.xlsx to the estimates folder. A sample file which details the contents of this file is located in the sample_files folder.
  4. (Optional) To add the reform to the interactive Chart (see the web folder & https://mvpfde.de), a new entry to variable_mapping.json has to added. This file maps the return values of the WhateverTheIdentifierIs.R file to individual effects as displayed in the bar charts. For this to work, the willingness to pay and the government net cost need to be expressable as the sum of the other return values of the WhateverTheIdentifierIs function. See the exampleProgram.R file in the sample_files folder for further explanations.

The folder structure should then look like this:

Project Folder
│   README.md
│   main.R
|   programs.xlsx
|   variable_mapping.json
│   ...
│
└───programs
│       └───someProgramIdentifier
|       |   │   someProgramIdentifier.R
|       |
│       └───AnotherProgramIdentifier
│       |   │   AnotherProgramIdentifier.R
|       |
|       └───WhateverTheIdentifierIs
│       |   │   WhateverTheIdentifierIs.R
|       |
|       ...
│   
└───estimates
    │   someProgramIdentifier.xlsx
    │   AnotherProgramIdentifier.xlsx
    |   WhateverTheIdentifierIs.xlsx
    |   ...

Finally, a new row to programs.xlsx may be added to add additional information about the reform such as the year, the category, the age of the benefciaries etc. This last step is optional, but the reform will be missing in some of the graphs if the necessary information is not provided in programs.xlsx. In general, if a program does not match the structure from above, a hopefully informative error message should be displayed.