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Permutation inference with a finite number of heterogeneous clusters

Andreas Hagemann

arXiv 1 Jul 2019 · Econometrics · publishedThe Review of Economics and Statistics (2023) · 10 citations (OpenAlex)

arXiv:1907.01049 · PDF · DOI · OpenAlex · Extracted main text

Abstract

I introduce a simple permutation procedure to test conventional (non-sharp) hypotheses about the effect of a binary treatment in the presence of a finite number of large, heterogeneous clusters when the treatment effect is identified by comparisons across clusters. The procedure asymptotically controls size by applying a level-adjusted permutation test to a suitable statistic. The adjustments needed for most empirically relevant situations are tabulated in the paper. The adjusted permutation test is easy to implement in practice and performs well at conventional levels of significance with at least four treated clusters and a similar number of control clusters. It is particularly robust to situations where some clusters are much more variable than others. Examples and an empirical application are provided.

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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Bester, C. Alan, Timothy G. Conley, and Christian B. Hansen (2011) Inference with dependent data using cluster covariance estimators0.92843100%
2Canay, Ivan A., Joseph P. Romano, and Azeem M. Shaikh (2017) Randomization tests under an approximate symmetry assumption0.8947471%
3Angrist, Joshua and Victor Lavy (2009) The effects of high stakes high school achievement awards: Evidence from a randomized trial0.69391100%
4Canay, Ivan A., Andres Santos, and Azeem M. Shaikh (2021) small0.64422100%
5Hoeffding, Wassily (1952) The large-sample power of tests based on permutations of observations0.64422100%
6Ibragimov, Rustam and Ulrich Müller (2016) Inference with few heterogenous clusters0.62125424%
7Cameron, A. Colin, Jonah B. Gelbach, and Douglas L. Miller (2008) Bootstrap-based improvements for inference with clustered errors0.51121100%
8Conley, Timothy G. and Christopher R. Taber (2011) difference in differences0.51121100%
9El Machkouri, Mohamed, Dalibor Volný, and Wei Biao Wu (2013) A central limit theorem for stationary random fields0.51121100%
10Székely, Gabor J (2006) Students t-test for scale mixture errors0.51121100%

Showing the top 10 of 27 scored citations.

Cited by, within the corpus

arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.

Citing paperIntensityMentionsSections
1Combining Clusters for the Approximate Randomization Test0.87452
2Inference with a single treated cluster0.64422
3Cluster-robust inference with a single treated cluster using the t-test0.64422
4Inference for Synthetic Controls via Refined Placebo Tests0.51121
5Inference in Difference-in-Differences with Few Treated Units and Spatial Correlation0.40511
6What's Trending in Difference-in-Differences? A Synthesis of the Recent Econometrics Literature0.40511
7Inference on quantile processes with a finite number of clusters0.40511
8Inference with few treated units0.40511