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(Visualizing) Plausible Treatment Effect Paths

Simon Freyaldenhoven, Christian Hansen

arXiv 17 May 2025 · Econometrics · 1 citations (OpenAlex)

arXiv:2505.12014 · PDF · DOI · OpenAlex · Extracted main text

Abstract

We consider point estimation and inference for the treatment effect path of a policy. Examples include dynamic treatment effects in microeconomics, impulse response functions in macroeconomics, and event study paths in finance. We present two sets of plausible bounds to quantify and visualize the uncertainty associated with this object. Both plausible bounds are often substantially tighter than traditional confidence intervals, and can provide useful insights even when traditional (uniform) confidence bands appear uninformative. Our bounds can also lead to markedly different conclusions when there is significant correlation in the estimates, reflecting the fact that traditional confidence bands can be ineffective at visualizing the impact of such correlation. Our first set of bounds covers the average (or overall) effect rather than the entire treatment path. Our second set of bounds imposes data-driven smoothness restrictions on the treatment path. Post-selection Inference (Berk et al. [2013]) provides formal coverage guarantees for these bounds. The chosen restrictions also imply novel point estimates that perform well across our simulations.

Citation extraction

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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
1Richard Berk, Lawrence Brown, Andreas Buja, Kai Zhang, and Linda Zhao (2013) Valid post-selection inference1.00084100%
2Mariano Bosch and Raymundo M Campos-Vazquez (2014) The trade-offs of welfare policies in labor markets with informal jobs: The case of the “seguro popular” program in Mexico0.64441100%
3Regis Barnichon and Christian Matthes (2018) Functional approximation of impulse responses0.64422100%
4Regis Barnichon and Christian Brownlees (2019) Impulse response estimation by smooth local projections0.64422100%
5Christopher Genovese and Larry Wasserman (2008) Adaptive confidence bands0.64422100%
6Levi Boxell, Matthew Gentzkow, and Jesse M. Shapiro (2024) Cross-country trends in affective polarization0.5112250%
7Brantly Callaway and Pedro H.C. Sant’Anna (2021) Difference-in-differences with multiple time periods0.5112250%
8Joachim Freyberger and Yoshiyasu Rai (2018) Uniform confidence bands: Characterization and optimality0.5112250%
9Òscar Jordà (2023) Local projections for applied economics0.5112250%
10José Luis Montiel Olea and Mikkel Plagborg-Mller (2019) Simultaneous confidence bands: Theory, implementation, and an application to SVARs0.5112250%

Showing the top 10 of 26 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
1Local Projections or VARs? A Primer for Macroeconomists0.40511