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Statistical verification of a natural "natural experiment": Tests and sensitivity checks for the sibling sex ratio instrument

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  • Huber, Martin

Abstract

This paper presents statistical evidence about the validity of the sibling sex ratio instrument proposed by Angrist and Evans (1998), a prominent natural “natural experiment” in the sense of Rosenzweig and Wolpin (2000). The sex ratio of the first two siblings is arguably randomly assigned and influences the probability of having a third child, which makes it a candidate instrument for fertility when estimating the effect of fertility on female labor supply. However, identification hinges on the satisfaction of the instrumental exclusion restriction and the monotonicity of fertility in the instrument, see Imbens and Angrist (1994). Using the methods of Kitagawa (2008), Huber and Mellace (2011a), and Huber and Mellace (2012), we for the first time verify the validity of the sibling sex ratio instrument by statistical hypothesis tests, which suggest that violations are small if not close to nonexistent. We also provide novel sensitivity checks to assess deviations from the exclusion restriction and/or monotonicity in the nonparametric local average treatment effect framework and find the negative labor supply effect of fertility to be robust to a plausible range of violations.

Suggested Citation

  • Huber, Martin, 2012. "Statistical verification of a natural "natural experiment": Tests and sensitivity checks for the sibling sex ratio instrument," Economics Working Paper Series 1219, University of St. Gallen, School of Economics and Political Science.
  • Handle: RePEc:usg:econwp:2012:19
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    File URL: http://ux-tauri.unisg.ch/RePEc/usg/econwp/EWP-1219.pdf
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    References listed on IDEAS

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    Cited by:

    1. Angelov, Nikolay & Karimi, Arizo, 2012. "Mothers’ Income Recovery after Childbearing," Working Paper Series, Center for Labor Studies 2012:19, Uppsala University, Department of Economics.
    2. Iva Trako, 2018. "Fertility and Parental Labor-Force Participation: New Evidence from a Developing Country in the Balkans," PSE Working Papers halshs-01828471, HAL.
    3. de Chaisemartin, Clement, 2013. "Defying the LATE? Identification of local treatment effects when the instrument violates monotonicity," The Warwick Economics Research Paper Series (TWERPS) 1020, University of Warwick, Department of Economics.
    4. Iva Trako, 2018. "Fertility and Parental Labor-Force Participation: New Evidence from a Developing Country in the Balkans," Working Papers halshs-01828471, HAL.

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    More about this item

    Keywords

    instrumental variable; treatment effects; LATE; tests; sensitivity analysis.;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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