Fragility of the Marginal Treatment Effect

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Title: Fragility of the Marginal Treatment Effect
Authors: Devereux, Paul J.
Permanent link: http://hdl.handle.net/10197/12777
Date: 25-Jan-2022
Online since: 2022-02-28T16:47:25Z
Abstract: Many interesting and important economic questions relate to the effects of binary treatments such as starting a college degree or participating in a job training program. The causal effects of these treatments are likely to be heterogeneous and recent research has emphasized the estimation of heterogeneous treatment effects, with a particular focus on Marginal Treatment Effects (MTEs). In this note, I describe why common methods of estimating MTEs of binary treatments can be very sensitive to omitted higher powers of covariates and demonstrate this using simple Monte Carlo simulations. I conclude by discussing approaches that may be useful for researchers to address this problem in practice.
Funding Details: Research Council of Norway
Type of material: Working Paper
Publisher: University College Dublin. School of Economics
Start page: 1
End page: 29
Series/Report no.: UCD Centre for Economic Research Working Paper Series; WP2022/04
Copyright (published version): 2022 the Author
Keywords: Marginal treatment effectsInstrumental variables
JEL Codes: C26; C01
Language: en
Status of Item: Not peer reviewed
This item is made available under a Creative Commons License: https://creativecommons.org/licenses/by-nc-nd/3.0/ie/
Appears in Collections:Economics Working Papers & Policy Papers

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