External Validity in a Stochastic World

Mark Rosenzweig and Christopher Udry

Working Papers from Economic Growth Center, Yale University

Abstract: We examine the generalizability of internally valid estimates of causal effects in a fixed population over time when that population is subject to aggregate shocks. This temporal external validity is shown to depend upon the distribution of the aggregate shocks and the interaction between these shocks and the casual effects. We show that returns to investment in agriculture, small and medium enterprises and human capital differ significantly from year to year. We also show how returns to investments interact with specific aggregate shocks, and estimate the parameters of the distributions of these shocks. We show how to use these estimates to appropriately widen estimated confidence intervals to account for aggregate shocks.

Keywords: returns to investment; heterogeneity; treatment effect (search for similar items in EconPapers)
JEL-codes: C93 O1 O13 O14 O15 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2016-07
New Economics Papers: this item is included in nep-agr, nep-cse and nep-ecm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Related works:
Working Paper: External Validity in a Stochastic World (2016)
Working Paper: External Validity in a Stochastic World (2016)
Working Paper: External Validity in a Stochastic World (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:egc:wpaper:1054

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