Université de Fribourg

Local Average Treatment Effects with or Without Defiers

Dahl, Christian M. ; Huber, Martin ; Mellace, Giovanni

In: Discussion papers on business and economics, 2017, vol. 2, p. 1-69

In heterogeneous treatment effect models with endogeneity, identification of the LATE typically relies on the availability of an exogenous instrument monotonically related to treatment participation. We demonstrate that a strictly weaker local monotonicity condition identifies the LATEs on compliers and on defiers. We propose simple estimators that are potentially more efficient than 2SLS,...

Université de Fribourg

Instrument-based estimation with binarized treatments : issues and tests for the exclusion restriction

Andresen, Martin Eckhoff ; Huber, Martin

(Working Papers SES ; 492)

When estimating local average and marginal treatment effects using instrumental variables (IV), multivalued endogenous treatments are frequently binarized based on a specific threshold in treatment support. However, such binarization introduces a violation of the IV exclusion if (i) the IV affects the multivalued treatment within support areas below and/or above the threshold and (ii) such...