This paper considers the evaluation of the average treatment effect of a binary endogenous regressor on a binary outcome when one imposes a threshold crossing model on both the endogenous regressor and the outcome variable but without imposing parametric functional form or distributional assumptions. Without parametric restrictions, the average effect of the binary endogenous variable is not generally point identified. This paper constructs sharp bounds on the average effect of the endogenous variable that exploit the structure of the threshold crossing models and any exclusion restrictions. We also develop methods for inference on the resulting bounds.
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Technical Working Papers with number
0307.
Length: Date of creation: May 2005 Date of revision: Handle: RePEc:nbr:nberte:0307
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Find related papers by JEL classification: C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - Semiparametric and Nonparametric Methods C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models
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