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Treatment Effect Heterogeneity in Theory and Practice

46 Pages Posted: 8 Aug 2003  

Joshua D. Angrist

Massachusetts Institute of Technology (MIT) - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Multiple version iconThere are 3 versions of this paper

Date Written: August 2003

Abstract

Instrumental Variables (IV) methods identify internally valid causal effects for individuals whose treatment status is manipulable by the instrument at hand. Inference for other populations requires homogeneity assumptions. This paper outlines a theoretical framework that nests causal homogeneity assumptions. These ideas are illustrated using sibling-sex composition to estimate the effect of child-bearing on economic and marital outcomes. The application is motivated by American welfare reform. The empirical results generally support the notion of reduced labor supply and increased poverty as a consequence of childbearing, but evidence on the impact of childbearing on marital stability and welfare use is more tenuous.

Keywords: Instrumental Variables, Marital Stability, Welfare, Causal Effects

JEL Classification: C31, J12, J13

Suggested Citation

Angrist, Joshua D., Treatment Effect Heterogeneity in Theory and Practice (August 2003). MIT Department of Economics Working Paper No. 03-27; IZA Discussion Paper No. 851. Available at SSRN: https://ssrn.com/abstract=432501 or http://dx.doi.org/10.2139/ssrn.432501

Joshua Angrist (Contact Author)

National Bureau of Economic Research (NBER)

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IZA Institute of Labor Economics

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Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

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