In Pursuit of Balance: Randomization in Practice in Development Field Experiments

59 Pages Posted: 20 Apr 2016

See all articles by Miriam Bruhn

Miriam Bruhn

World Bank - Development Research Group (DECRG)

David J. McKenzie

World Bank - Development Research Group (DECRG); IZA Institute of Labor Economics

Date Written: October 1, 2008

Abstract

Randomized experiments are increasingly used in development economics, with researchers now facing the question of not just whether to randomize, but how to do so. Pure random assignment guarantees that the treatment and control groups will have identical characteristics on average, but in any particular random allocation, the two groups will differ along some dimensions. Methods used to pursue greater balance include stratification, pair-wise matching, and re-randomization. This paper presents new evidence on the randomization methods used in existing randomized experiments, and carries out simulations in order to provide guidance for researchers. Three main results emerge. First, many researchers are not controlling for the method of randomization in their analysis. The authors show this leads to tests with incorrect size, and can result in lower power than if a pure random draw was used. Second, they find that in samples of 300 or more, the different randomization methods perform similarly in terms of achieving balance on many future outcomes of interest. However, for very persistent outcome variables and in smaller sample sizes, pair-wise matching and stratification perform best. Third, the analysis suggests that on balance the re-randomization methods common in practice are less desirable than other methods, such as matching.

Keywords: Statistical & Mathematical Sciences, Scientific Research & Science Parks, Science Education, Economic Theory & Research, Climate Change

Suggested Citation

Bruhn, Miriam and McKenzie, David John, In Pursuit of Balance: Randomization in Practice in Development Field Experiments (October 1, 2008). World Bank Policy Research Working Paper No. 4752, Available at SSRN: https://ssrn.com/abstract=1293165

Miriam Bruhn (Contact Author)

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

David John McKenzie

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

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