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A note on bounding average treatment effects

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  • Lafférs, Lukáš
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    Abstract

    Imposing the monotone treatment selection (MTS) assumption and the monotone instrumental variable (MIV) assumption implies bounds on average treatment effect that differ from those commonly reported in the applied literature. Instead, for the bounds to be correct, we should use an MTS assumption conditional on the value of a monotone instrument (cMTS). In this paper, we present an empirical example of bounding the effect of the mother’s education on her children’s education, in which the MTS and cMTS assumptions lead to considerably different bounds on the treatment effects.

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    Bibliographic Info

    Article provided by Elsevier in its journal Economics Letters.

    Volume (Year): 120 (2013)
    Issue (Month): 3 ()
    Pages: 424-428

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    Handle: RePEc:eee:ecolet:v:120:y:2013:i:3:p:424-428

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    Web page: http://www.elsevier.com/locate/ecolet

    Related research

    Keywords: Partial identification; Bounds; Average treatment effect;

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    1. Charles F. Manski & John V. Pepper, 1998. "Monotone Instrumental Variables with an Application to the Returns to Schooling," NBER Technical Working Papers 0224, National Bureau of Economic Research, Inc.
    2. Manski, C.F., 1996. "Monotone Treatment Response," Working papers 9604, Wisconsin Madison - Social Systems.
    3. Gary S. Becker, 1974. "A Theory of Marriage," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 299-351 National Bureau of Economic Research, Inc.
    4. Kreider, Brent & Pepper, John V. & Gundersen, Craig & Jolliffe, Dean, 2012. "Identifying the Effects of SNAP (Food Stamps) on Child Health Outcomes When Participation is Endogenous and Misreported," Staff General Research Papers 13124, Iowa State University, Department of Economics.
    5. Libertad González, 2005. "Nonparametric bounds on the returns to language skills," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(6), pages 771-795.
    6. Gundersen, Craig & Kreider, Brent & Pepper, John, 2012. "The impact of the National School Lunch Program on child health: A nonparametric bounds analysis," Journal of Econometrics, Elsevier, vol. 166(1), pages 79-91.
    7. Gary S. Becker, 1974. "A Theory of Marriage: Part II," NBER Chapters, in: Marriage, Family, Human Capital, and Fertility, pages 11-26 National Bureau of Economic Research, Inc.
    8. Charles F. Manski, 2013. "Identification of treatment response with social interactions," Econometrics Journal, Royal Economic Society, vol. 16(1), pages S1-S23, 02.
    9. Manski, C.F., 1989. "Nonparametric Bounds On Treatment Effects," Working papers 8909, Wisconsin Madison - Social Systems.
    10. AfDB AfDB, . "The AfDB Statistics Pocketbook 2007," AfDB Statistics Pocketbook, African Development Bank, number 2 edited by Koua Louis Kouakou, 7.
    11. Kreider, Brent & Pepper, John V., 2007. "Disability and Employment: Reevaluating the Evidence in Light of Reporting Errors," Journal of the American Statistical Association, American Statistical Association, vol. 102, pages 432-441, June.
    12. Gundersen, Craig & Kreider, Brent, 2008. "Bounding the Effects of Food Insecurity on Children's Health Outcomes," Staff General Research Papers 13008, Iowa State University, Department of Economics.
    13. Galichon, Alfred & Henry, Marc, 2009. "A test of non-identifying restrictions and confidence regions for partially identified parameters," Journal of Econometrics, Elsevier, vol. 152(2), pages 186-196, October.
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