Selective Trials: A Principal-Agent Approach to Randomized Controlled Experiments

51 Pages Posted: 22 Dec 2010  

Sylvain Chassang

Princeton University William S. Dietrich II Economic Theory Center

Gerard Padró i Miquel

London School of Economics & Political Science (LSE); National Bureau of Economic Research (NBER)

Erik Snowberg

California Institute of Technology - Division of the Humanities and Social Sciences; National Bureau of Economic Research (NBER)

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Date Written: December 21, 2010

Abstract

We study the design of randomized controlled experiments in environments where outcomes are significantly affected by unobserved effort decisions taken by the subjects (agents). While standard randomized controlled trials (RCTs) are internally consistent, the unobservability of effort provision compromises external validity. We approach trial design as a principal-agent problem and show that natural extensions of RCTs - which we call selective trials - can help improve the external validity of experiments. In particular, selective trials can disentangle the effects of treatment, effort, and the interaction of treatment and effort. Moreover, they can help experimenters identify when measured treatment effects are affected by erroneous beliefs and inappropriate effort provision.

Keywords: Randomized Controlled Trials, Selective Trials, Blind Trials, Incentivized Trials, Marginal Treatment Effects, Mechanism Design, Selection, Heterogeneous Beliefs, Compliance

JEL Classification: C81, C93, D82, O12

Suggested Citation

Chassang, Sylvain and Padró i Miquel, Gerard and Snowberg, Erik, Selective Trials: A Principal-Agent Approach to Randomized Controlled Experiments (December 21, 2010). Economic Theory Center Working Paper No. 003-2010. Available at SSRN: https://ssrn.com/abstract=1729274 or http://dx.doi.org/10.2139/ssrn.1729274

Sylvain Chassang (Contact Author)

Princeton University William S. Dietrich II Economic Theory Center ( email )

Princeton, NJ 08544-1021
United States

Gerard Padro i Miquel

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Erik Snowberg

California Institute of Technology - Division of the Humanities and Social Sciences ( email )

1200 East California Blvd.
Pasadena, CA 91125
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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