NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Instrumental Variables, Selection Models, and Tight Bounds on the Average Treatment Effect

James J. Heckman, Edward J. Vytlacil

NBER Technical Working Paper No. 259
Issued in August 2000
NBER Program(s):   TWP

This paper exposits and relates two distinct approaches to bounding the average treatment effect. One approach, based on instrumental variables, is due to Manski (1990, 1994), who derives tight bounds on the average treatment effect under a mean independence form of the instrumental variables (IV) condition. The second approach, based on latent index models, is due to Heckman and Vytlacil (1999, 2000a), who derive bounds on the average treatment effect that exploit the assumption of a nonparametric selection model with an exclusion restriction. Their conditions imply the instrumental variable condition studied by Manski, so that their conditions are stronger than the Manski conditions. In this paper, we study the relationship between the two sets of bounds implied by these alternative conditions. We show that: (1) the Heckman and Vytlacil bounds are tight given their assumption of a nonparametric selection model; (2) the Manski bounds simplify to the Heckman and Vytlacil bounds under the nonparametric selection model assumption.

download in pdf format
   (283 K)

email paper

This paper is available as PDF (283 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/t0259

Users who downloaded this paper also downloaded these:
Heckman and Vytlacil t0252 Local Instrumental Variables
Heckman, Tobias, and Vytlacil w7950 Simple Estimators for Treatment Parameters in a Latent Variable Framework with an Application to Estimating the Returns to Schooling
Heckman, Ichimura, Smith, and Todd w6699 Characterizing Selection Bias Using Experimental Data
Manski and Pepper t0224 Monotone Instrumental Variables with an Application to the Returns to Schooling
Heckman, Urzua, and Vytlacil w12574 Understanding Instrumental Variables in Models with Essential Heterogeneity
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us