Dept. of Policy Analysis and Management
134 Martha Van Rensselaer Hall
Ithaca, NY 14853-4401
Institutional Affiliation: Cornell University
NBER Working Papers and Publications
|March 2017||Poorly Measured Confounders are More Useful on the Left Than on the Right|
with Jörn-Steffen Pischke, Hannes Schwandt: w23232
Researchers frequently test identifying assumptions in regression based research designs (which include instrumental variables or difference-in-differences models) by adding additional control variables on the right hand side of the regression. If such additions do not affect the coefficient of interest (much) a study is presumed to be reliable. We caution that such invariance may result from the fact that the observed variables used in such robustness checks are often poor measures of the potential underlying confounders. In this case, a more powerful test of the identifying assumption is to put the variable on the left hand side of the candidate regression. We provide derivations for the estimators and test statistics involved, as well as power calculations, which can help applied resear...
|October 2016||Regression Kink Design: Theory and Practice|
with David Card, David S. Lee, Andrea Weber: w22781
A regression kink design (RKD or RK design) can be used to identify casual effects in settings where the regressor of interest is a kinked function of an assignment variable. In this paper, we apply an RKD approach to study the effect of unemployment benefits on the duration of joblessness in Austria, and discuss implementation issues that may arise in similar settings, including the use of bandwidth selection algorithms and bias-correction procedures. Although recent developments in nonparametric estimation (e.g. Imbens et al. (2012) and Calonico et al. (2014)) are sometimes interpreted by practitioners as pointing to a default estimation procedure, we show that in any given application different procedures may perform better or worse. In particular, Monte Carlo simulations based on data ...
|January 2015||The Effect of Unemployment Benefits on the Duration of Unemployment Insurance Receipt: New Evidence from a Regression Kink Design in Missouri, 2003-2013|
with David Card, Andrew Johnston, Pauline Leung, Alexandre Mas: w20869
We provide new evidence on the effect of the unemployment insurance (UI) weekly benefit amount on unemployment insurance spells based on administrative data from the state of Missouri covering the period 2003-2013. Identification comes from a regression kink design that exploits the quasi-experimental variation around the kink in the UI benefit schedule. We find that UI durations are more responsive to benefit levels during the recession and its aftermath, with an elasticity between 0.65 and 0.9 as compared to about 0.35 pre-recession.
Published: David Card & Andrew Johnston & Pauline Leung & Alexandre Mas & Zhuan Pei, 2015. "The Effect of Unemployment Benefits on the Duration of Unemployment Insurance Receipt: New Evidence from a Regression Kink Design in Missouri, 2003-2013," American Economic Review, American Economic Association, vol. 105(5), pages 126-30, May. citation courtesy of
|November 2012||Nonlinear Policy Rules and the Identification and Estimation of Causal Effects in a Generalized Regression Kink Design|
with David Card, David Lee, Andrea Weber: w18564
We consider nonparametric identification and estimation in a nonseparable model where a continuous regressor of interest is a known, deterministic, but kinked function of an observed assignment variable. This design arises in many institutional settings where a policy variable (such as weekly unemployment benefits) is determined by an observed but potentially endogenous assignment variable (like previous earnings). We provide new results on identification and estimation for these settings, and apply our results to obtain estimates of the elasticity of joblessness with respect to UI benefit rates. We characterize a broad class of models in which a "Regression Kink Design" (RKD, or RK Design) provides valid inferences for the treatment-on-the-treated parameter (Florens et al. (2008)) that w...