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Individuals living in high-poverty areas perform worse than those living in low-poverty areas on a wide range of

outcomes such as earnings, health conditions and education levels. Motivated by such disparities, the U.S. Department of Housing and Urban Development (HUD) o↵ered housing vouchers to low-income families. These housing vouchers pay a large portion of the rents and utilities (e.g. Section 8). Image that you are a policy maker trying to evaluate the e↵ectiveness of the housing vouchers. Suppose you are most interested in the long-term impacts of housing vouchers on children who were young when their families received the voucher. (a) (8 points) You want to focus on the impact of housing vouchers on children's future earnings. Your colleague, another policy maker, suggests you to compare the average future earnings for children whose families received a housing voucher with those whose families didn't received a housing voucher. Do you think your colleague's suggestion is a good idea? Why?

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