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Partial Identification of Discrete Counterfactual Distributions with Sequential Update of Information

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  • Stefan Boes

    () (Socioeconomic Institute, University of Zurich)

Abstract

The credibility of standard instrumental variables assumptions is often under dispute. This paper imposes weak monotonicity in order to gain information on counterfactual outcomes, but avoids independence or exclusion restrictions. The outcome process is assumed to be sequentially ordered, building up and depending on the information level of agents. The potential outcome distribution is assumed to weakly increase (or decrease) with the instrument, conditional on the continuation up to a certain stage. As a general result, the counterfactual distributions can only be bounded, but the derived bounds are informative compared to the no-assumptions bounds thus justifying the instrumental variables terminology. The construction of bounds is illustrated in two data examples.

Suggested Citation

  • Stefan Boes, 2009. "Partial Identification of Discrete Counterfactual Distributions with Sequential Update of Information," SOI - Working Papers 0918, Socioeconomic Institute - University of Zurich.
  • Handle: RePEc:soz:wpaper:0918
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    File URL: http://www.econ.uzh.ch/static/wp_soi/wp0918.pdf
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    References listed on IDEAS

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    Cited by:

    1. Stefan Boes & Rainer Winkelmann, 2006. "Ordered response models," AStA Advances in Statistical Analysis, Springer;German Statistical Society, pages 167-181.

    More about this item

    Keywords

    nonparametric bounds; treatment effects; endogeneity; binary choice; monotone instrumental variables; policy evaluation;

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions

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