At What Level Should One Cluster Standard Errors in Paired and Small-Strata Experiments?

Clément de Chaisemartin and Jaime Ramirez-Cuellar
Additional contact information
Jaime Ramirez-Cuellar: Microsoft - Microsoft Research [Cambridge] - Microsoft Research

SciencePo Working papers Main from HAL

Abstract: In clustered and paired experiments, to estimate treatment effects, researchers often regress their outcome on the treatment and pair fixed effects, clustering standard errors at the unit-ofrandomization level. We show that even if the treatment has no effect, a 5%-level t-test based on this regression will wrongly conclude that the treatment has an effect up to 16.5% of the time, an error rate much larger than the researcher's 5% target. To achieve their targeted error rate, researchers should instead cluster standard errors at the pair level. Using simulations, we show that similar results apply to clustered experiments with small strata.

Keywords: clustered standard errors; clustering; paired experiments; stratified experiments; randomized experiments; RCT (search for similar items in EconPapers)
Date: 2022-09-15
New Economics Papers: this item is included in nep-exp
Note: View the original document on HAL open archive server: https://sciencespo.hal.science/hal-03873897
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://sciencespo.hal.science/hal-03873897/document (application/pdf)

Related works:
Journal Article: At What Level Should One Cluster Standard Errors in Paired and Small-Strata Experiments? (2024)
Working Paper: At What Level Should One Cluster Standard Errors in Paired and Small-Strata Experiments? (2023)
Working Paper: At What Level Should One Cluster Standard Errors in Paired and Small-Strata Experiments? (2022)
Working Paper: At What Level Should One Cluster Standard Errors in Paired and Small-Strata Experiments? (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:spmain:hal-03873897

DOI: 10.2139/ssrn.3520820

Access Statistics for this paper

More papers in SciencePo Working papers Main from HAL
Bibliographic data for series maintained by Contact - Sciences Po Departement of Economics ().