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Can Variation in Subgroups' Average Treatment Effects Explain Treatment Effect Heterogeneity? Evidence from a Social Experiment

Author

Listed:
  • Marianne P. Bitler

    (University of California, Davis and NBER)

  • Jonah B. Gelbach

    (University of Pennsylvania Law School)

  • Hilary W. Hoynes

    (University of California, Berkeley and NBER)

Abstract

We assess whether welfare reform affects earnings only through mean impacts that are constant within but vary across subgroups. This is important because researchers interested in treatment effect heterogeneity typically focus on estimating mean impacts that only vary across subgroups. Using a novel approach to simulating treatment group earnings under the constant mean impacts within subgroup model, we find this model does a poor job of capturing treatment effect heterogeneity for Connecticut's Jobs First welfare reform experiment. Notably, ignoring within-group heterogeneitywould lead one to miss evidence that treatment effects are consistent with basic labor supply theory.

Suggested Citation

  • Marianne P. Bitler & Jonah B. Gelbach & Hilary W. Hoynes, 2017. "Can Variation in Subgroups' Average Treatment Effects Explain Treatment Effect Heterogeneity? Evidence from a Social Experiment," The Review of Economics and Statistics, MIT Press, vol. 99(4), pages 683-697, July.
  • Handle: RePEc:tpr:restat:v:99:y:2017:i:4:p:683-697
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    References listed on IDEAS

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    Cited by:

    1. Lazuka, Volha, 2017. "The lasting health and income effects of public health formation in Sweden," Lund Papers in Economic History 153, Lund University, Department of Economic History.
    2. Xavier D’Haultfoeuille & Pauline Givord, 2014. "La régression quantile en pratique," Économie et Statistique, Programme National Persée, vol. 471(1), pages 85-111.
    3. Garlick, Robert, 2014. "Academic peer effects with different group assignment policies : residential tracking versus random assignment," Policy Research Working Paper Series 6787, The World Bank.
    4. Charles E. Gibbons & Juan Carlos Suárez Serrato & Michael B. Urbancic, 2014. "Broken or Fixed Effects?," NBER Working Papers 20342, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

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