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Semiparametric inference for impulse response functions using double/debiased machine learning

Daniele Ballinari, Alexander Wehrli

arXiv 15 Nov 2024 · Econometrics

arXiv:2411.10009 · PDF · DOI · OpenAlex · Extracted main text

Abstract

We introduce a double/debiased machine learning (DML) estimator for the impulse response function (IRF) in settings where a time series of interest is subjected to multiple discrete treatments, assigned over time, which can have a causal effect on future outcomes. The proposed estimator can rely on fully nonparametric relations between treatment and outcome variables, opening up the possibility to use flexible machine learning approaches to estimate IRFs. To this end, we extend the theory of DML from an i.i.d. to a time series setting and show that the proposed DML estimator for the IRF is consistent and asymptotically normally distributed at the parametric rate, allowing for semiparametric inference for dynamic effects in a time series setting. The properties of the estimator are validated numerically in finite samples by applying it to learn the IRF in the presence of serial dependence in both the confounder and observation innovation processes. We also illustrate the methodology empirically by applying it to the estimation of the effects of macroeconomic shocks.

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98
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175
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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
1Chernozhukov, Victor and Chetverikov, Denis and Demirer, Mert and Du… (2018) Double/debiased machine learning for treatment and structural parameters1.000175100%
2Joshua D. Angrist and Òscar Jordà and Guido M. Kuersteiner (2018) Semiparametric Estimates of Monetary Policy Effects: String Theory Revisited1.000155100%
3Davidson, James (2021) Stochastic Limit Theory: An Introduction for Econometricians1.00063100%
4Whitney K. Newey and Kenneth D. West (1994) Automatic Lag Selection in Covariance Matrix Estimation1.00055100%
5Òscar Jordà (2005) Estimation and Inference of Impulse Responses by Local Projections1.00053100%
6Kiefer, Nicholas M and Vogelsang, Timothy J (2005) A new asymptotic theory for heteroskedasticity-autocorrelation robust tests0.92843100%
7Whitney K. Newey and Kenneth D. West (1987) A Simple, Positive Semi-Definite, Heteroskedasticity and Autocorrelation Consistent Covariance Matrix0.87462100%
8Semenova, Vira and Goldman, Matt and Chernozhukov, Victor and Taddy,… (2023) Inference on heterogeneous treatment effects in high-dimensional dynamic panels under weak dependence0.87452100%
9Adamek, Robert and Smeekes, Stephan and Wilms, Ines (2024) Local Projection Inference in High Dimensions0.84333100%
10Lazarus, E. and Lewis, D. J. and Stock, J. H. and Watson, M. W (2018) HAR Inference: Recommendations for Practice0.84333100%

Showing the top 10 of 98 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
1When are time series predictions causal? The potential system and dynamic causal effects0.64422
2Semiparametric Local Projections0.64422
3When do common time series estimands have nonparametric causal meaning?0.40511
4Dynamic Causal Effects in a Nonlinear World: the Good, the Bad, and the Ugly0.40511
5An Introduction to Double/Debiased Machine Learning0.40511