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A review of causal mediation analysis for assessing direct and indirect treatment effects

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  • Huber, Martin

Abstract

Mediation analysis aims at evaluating the causal mechanisms through which a treatment or intervention affects an outcome of interest. The goal is to disentangle the total treatment effect into an indirect effect operating through one or several observed intermediate variables, the so-called mediators, as well as a direct effect reflecting any impact not captured by the observed mediator(s). This paper reviews methodological advancements with a particular focus on applications in economics. It defines the parameters of interest, covers various identification strategies, e.g. based on control variables or instruments, and presents sensitivity checks. Furthermore, it discusses several extensions of the standard mediation framework, such as multivalued treatments, mismeasured mediators, and outcome attrition.

Suggested Citation

  • Huber, Martin, 2019. "A review of causal mediation analysis for assessing direct and indirect treatment effects," FSES Working Papers 500, Faculty of Economics and Social Sciences, University of Freiburg/Fribourg Switzerland.
    • Handle: RePEc:fri:fribow:fribow00500
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    Citations

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    Cited by:

    1. Viviana Celli, 2019. "Causal Mediation Analysis in Economics: objectives, assumptions, models," Working Papers 12/19, Sapienza University of Rome, DISS.
    2. Bonsang, Eric & Costa-Font, Joan, 2022. "Buying control? ‘Locus of control’ and the uptake of supplementary health insurance," Journal of Economic Behavior & Organization, Elsevier, vol. 204(C), pages 476-489.
    3. Martin Huber, 2019. "An introduction to flexible methods for policy evaluation," Papers 1910.00641, arXiv.org.
    4. Ackermann, Klaus & Awaworyi Churchill, Sefa & Smyth, Russell, 2024. "Estimating the relationship between ethnic inequality, conflict and voter turnout in Africa using geocoded data," World Development, Elsevier, vol. 180(C).
    5. Martin Huber & Yu‐Chin Hsu & Ying‐Ying Lee & Layal Lettry, 2020. "Direct and indirect effects of continuous treatments based on generalized propensity score weighting," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 35(7), pages 814-840, November.
    6. Sajid, Osama & Bevis, Leah E.M., 2021. "Flooding and child health: Evidence from Pakistan," World Development, Elsevier, vol. 146(C).
    7. Amin, Vikesh & Flores, Carlos A. & Flores-Lagunes, Alfonso, 2020. "The impact of BMI on mental health: Further evidence from genetic markers," Economics & Human Biology, Elsevier, vol. 38(C).
    8. Marco Doretti & Martina Raggi & Elena Stanghellini, 2022. "Exact parametric causal mediation analysis for a binary outcome with a binary mediator," Statistical Methods & Applications, Springer;Società Italiana di Statistica, vol. 31(1), pages 87-108, March.
    9. Andrew McKendrick & Ian Walker, 2020. "The Roles of Faith and Faith Schooling in Educational, Economic, and Faith Outcomes," Working Papers 302455074, Lancaster University Management School, Economics Department.
    10. Zhang, Zheyuan & Xu, Hui & Liu, Ruilin & Zhao, Zhong, 2024. "Free Education and the Intergenerational Transmission of Cognitive Skills in Rural China," IZA Discussion Papers 17314, Institute of Labor Economics (IZA).
    11. Viviana Celli, 2022. "Causal mediation analysis in economics: Objectives, assumptions, models," Journal of Economic Surveys, Wiley Blackwell, vol. 36(1), pages 214-234, February.
    12. Caterina Giannetti & Pietro Guarnieri & Tommaso Luzzati, 2021. "Pro-environmental attitude and behaviours: an investigation on the role of pro-sociality," Discussion Papers 2021/269, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    13. Soonwoo Kwon & Jonathan Roth, 2024. "Testing Mechanisms," Papers 2404.11739, arXiv.org.
    14. Eva Six & Matthias Schnetzer, 2022. "Highbrow heritage: the effects of early childhood cultural capital on wealth," Working Paper Reihe der AK Wien - Materialien zu Wirtschaft und Gesellschaft 240, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik.
    15. Bevis, Leah & Kim, Kichan & Guerena, David, 2023. "Soil zinc deficiency and child stunting: Evidence from Nepal," Journal of Health Economics, Elsevier, vol. 87(C).

    More about this item

    Keywords

    Mediation; direct effect; indirect effect; sequential conditional independence; instrument;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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