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Endogenous Stratification in Randomized Experiments

  • Alberto Abadie
  • Matthew M. Chingos
  • Martin R. West

Researchers and policy makers are often interested in estimating how treatments or policy interventions affect the outcomes of those most in need of help. This concern has motivated the increasingly common practice of disaggregating experimental data by groups constructed on the basis of an index of baseline characteristics that predicts the values that individual outcomes would take on in the absence of the treatment. This article shows that substantial biases may arise in practice if the index is estimated, as is often the case, by regressing the outcome variable on baseline characteristics for the full sample of experimental controls. We analyze the behavior of leave-one-out and repeated split sample estimators and show they behave well in realistic scenarios, correcting the large bias problem of the full sample estimator. We use data from the National JTPA Study and the Tennessee STAR experiment to demonstrate the performance of alternative estimators and the magnitude of their biases.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19742.

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Date of creation: Dec 2013
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Handle: RePEc:nbr:nberwo:19742
Note: CH DEV ED HE LS PE TWP
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  1. Heckman, James J & Smith, Jeffrey, 1997. "Making the Most Out of Programme Evaluations and Social Experiments: Accounting for Heterogeneity in Programme Impacts," Review of Economic Studies, Wiley Blackwell, vol. 64(4), pages 487-535, October.
  2. Joshua D. Angrist & J�rn-Steffen Pischke, 2010. "The Credibility Revolution in Empirical Economics: How Better Research Design Is Taking the Con out of Econometrics," Journal of Economic Perspectives, American Economic Association, vol. 24(2), pages 3-30, Spring.
  3. Jeanne Brooks-Gunn & J. Greg Duncan & Jeffrey R. Kling & Lisa Sanbonmatsu, 2004. "Neighborhoods and Academic Achievement: Results From The Moving to Opportunity Experiment," Working Papers 871, Princeton University, Department of Economics, Industrial Relations Section..
  4. Rodríguez-Planas, Núria, 2012. "School and Drugs: Closing the Gap – Evidence from a Randomized Trial in the US," IZA Discussion Papers 6770, Institute for the Study of Labor (IZA).
  5. Joshua Angrist & Victor Lavy, 2009. "The Effects of High Stakes High School Achievement Awards: Evidence from a Randomized Trial," American Economic Review, American Economic Association, vol. 99(4), pages 1384-1414, September.
  6. Douglas N. Harris & Sara Goldrick-Rab, 2012. "Improving the Productivity of Education Experiments: Lessons from a Randomized Study of Need-Based Financial Aid," Education Finance and Policy, MIT Press, vol. 7(2), pages 143-169, March.
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