Estimating Treatment Effects from Counts of Binary Outcomes: A Conditional Likelihood Estimator of Relative Risk

31 Pages Posted: 3 Dec 2016

See all articles by Christopher Aisbett

Christopher Aisbett

Laeta Pty. Ltd (Deceased)

Emma Aisbett

ANU - School of Regulation and Global Governance

Ralf Steinhauser

Universit at Hamburg; Research School of Economics

Date Written: December 2, 2016

Abstract

This paper introduces the conditional likelihood estimator of relative risk (CLERR). The CLERR estimates the relative risk of an outcome analogously to the way the conditional logit estimates an odds ratio. Aside from the fact that relative risk is often the preferred measure of association, the CLERR has superior statistical properties, including both unbiasedness and effciency in small and large samples. The CLERR can be thought of as an exact matching approach which allows estimation of treatment effects for binary outcomes, without the need for structural assumptions about the in influence of confounding variables. We apply the CLERR to World Bank's Enterprise Survey data and show that firms with female owners are signifcantly more likely to export than similar firms with only male owners.

Keywords: conditional likelihood, relative risk, treatment effects, matching, female owners, exporting

JEL Classification: C13, C14, C21, C25, F14, J16

Suggested Citation

Aisbett, Christopher and Aisbett, Emma and Steinhauser, Ralf, Estimating Treatment Effects from Counts of Binary Outcomes: A Conditional Likelihood Estimator of Relative Risk (December 2, 2016). Available at SSRN: https://ssrn.com/abstract=2879260 or http://dx.doi.org/10.2139/ssrn.2879260

Christopher Aisbett

Laeta Pty. Ltd (Deceased)

Australia

Emma Aisbett (Contact Author)

ANU - School of Regulation and Global Governance ( email )

Canberra, Australian Capital Territory 2601
Australia

Ralf Steinhauser

Universit at Hamburg ( email )

Welckerstr. 8,
Hamburg, Hamburg 20354
Germany

HOME PAGE: http://www.wiso.uni-hamburg.de/professuren/vwl-wachstum-umwelt-und-ressourcen/

Research School of Economics ( email )

Arndt Building 25a
Canberra, Australian Capital Territory 0200
Australia
0261254667 (Phone)

HOME PAGE: http://rse.anu.edu.au/people/people.php?ID=950

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