Mhbounds - Sensitivity Analysis for Average Treatment Effects

15 Pages Posted: 23 Jan 2007

See all articles by Sascha O. Becker

Sascha O. Becker

Monash University - Department of Economics; University of Warwick

Marco Caliendo

University of Potsdam; Institute for the Study of Labor (IZA)

Date Written: January 2007

Abstract

Matching has become a popular approach to estimate average treatment effects. It is based on the conditional independence or unconfoundedness assumption. Checking the sensitivity of the estimated results with respect to deviations from this identifying assumption has become an increasingly important topic in the applied evaluation literature. If there are unobserved variables which affect assignment into treatment and the outcome variable simultaneously, a hidden bias might arise to which matching estimators are not robust. We address this problem with the bounding approach proposed by Rosenbaum (2002), where mhbounds allows the researcher to determine how strongly an unmeasured variable must influence the selection process in order to undermine the implications of the matching analysis.

Keywords: matching, treatment effects, sensitivity analysis, unobserved heterogeneity

JEL Classification: C40

Suggested Citation

Becker, Sascha O. and Caliendo, Marco, Mhbounds - Sensitivity Analysis for Average Treatment Effects (January 2007). IZA Discussion Paper No. 2542, Available at SSRN: https://ssrn.com/abstract=958699

Sascha O. Becker

Monash University - Department of Economics ( email )

Wellington Road
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Australia

University of Warwick ( email )

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United Kingdom

Marco Caliendo (Contact Author)

University of Potsdam ( email )

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Potsdam, 14482
Germany
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+49(0)331/9773210 (Fax)

HOME PAGE: http://www.uni-potsdam.de/en/empwifo/news.html

Institute for the Study of Labor (IZA) ( email )

P.O. Box 7240
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Germany

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