Relaxing conditions for local average treatment effect in fuzzy regression discontinuity

Jin young Choi, Myoung-jae Lee

Research output: Contribution to journalArticle

Abstract

In fuzzy regression discontinuity with a running/forcing variable S and a cutoff c, the identified treatment effect is the ‘effect on compliers at S=c’. This well-known ‘local average treatment effect (LATE)’ interpretation requires (i) a monotonicity condition and (ii) the independence of the potential treatment and potential response variables from S. These assumptions can be violated, however, particularly (ii) when S affects potential variables, which can easily happen in practice. In this paper, we weaken both assumptions so that LATE in fuzzy regression discontinuity has a better chance to hold in the real world, and practitioners can claim their findings in fuzzy regression discontinuity to be LATE.

Original languageEnglish
Pages (from-to)47-50
Number of pages4
JournalEconomics Letters
Volume173
DOIs
Publication statusPublished - 2018 Dec 1

Keywords

  • Fuzzy regression discontinuity
  • Local average treatment effect
  • Moment continuity
  • Monotonicity condition

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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