arXiv 12 Jan 2021 · Econometrics · publishedThe Review of Economics and Statistics (2022) · 5 citations (OpenAlex)
arXiv:2101.04346 · PDF · DOI · OpenAlex · Extracted main text
This study proposes an econometric framework to interpret and empirically decompose the difference between IV and OLS estimates given by a linear regression model when the true causal effects of the treatment are nonlinear in treatment levels and heterogeneous across covariates. I show that the IV-OLS coefficient gap consists of three estimable components: the difference in weights on the covariates, the difference in weights on the treatment levels, and the difference in identified marginal effects that arises from endogeneity bias. Applications of this framework to return-to-schooling estimates demonstrate the empirical relevance of this distinction in properly interpreting the IV-OLS gap.
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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.
| Reference | Intensity | Mentions | Sections | Main text | |
|---|---|---|---|---|---|
| 1 | Carneiro, Pedro, Heckman, James J, Vytlacil, Edward J (2011) Estimating marginal returns to education | 0.928 | 5 | 3 | 80% |
| 2 | Oreopoulos, Philip (2006) Estimating average and local average treatment effects of education when compulsory schooling laws really matter | 0.909 | 12 | 4 | 75% |
| 3 | Cameron, Stephen V, Taber, Christopher (2004) Estimation of educational borrowing constraints using returns to schooling | 0.874 | 7 | 2 | 100% |
| 4 | Imbens, Guido W, Angrist, Joshua D (1994) Identification and estimation of local average treatment effects | 0.874 | 6 | 4 | 67% |
| 5 | Yitzhaki, Shlomo (1996) On using linear regressions in welfare economics | 0.874 | 6 | 4 | 67% |
| 6 | Acemoglu, Daron, Angrist, Joshua (2000) How large are human-capital externalities? Evidence from compulsory schooling laws | 0.811 | 15 | 4 | 53% |
| 7 | Angrist, Joshua D, Krueger, Alan B (1999) Empirical strategies in labor economics | 0.811 | 4 | 2 | 100% |
| 8 | Mogstad, Magne, Wiswall, Matthew (2010) Linearity in instrumental variables estimation: Problems and solutions | 0.811 | 4 | 2 | 100% |
| 9 | Angrist, Joshua D, Imbens, Guido W (1995) Two-stage least squares estimation of average causal effects in models with variable treatment intensity | 0.794 | 8 | 4 | 50% |
| 10 | Lochner, Lance, Moretti, Enrico (2015) Estimating and testing models with many treatment levels and limited instruments | 0.782 | 23 | 5 | 48% |
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