Serial-correlation-robust power calculation for the analysis-of-covariance estimator

Claes Ek ()
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Claes Ek: Department of Economics, School of Business, Economics and Law, Göteborg University, Postal: P.O. Box 640, SE 40530 GÖTEBORG, Sweden, http://economics.gu.se

No 788, Working Papers in Economics from University of Gothenburg, Department of Economics

Abstract: Ex-ante power calculation is an essential part of the toolkit of experimental economics. In panel experiments, analysis of covariance (ANCOVA) is more efficient than differencein- differences and is often preferred. The present paper derives a general serial-correlationrobust variance formula and provides the first analytical ANCOVA power-calculation framework to work with real data. A related earlier procedure for ANCOVA was found by Burlig et al. (2020) to yield incorrect power when used to calibrate a minimum detectable effect on actual data, and the authors caution against using it in practice. I show that these errors arose because time shocks were not properly accounted for in an intermediate procedure estimating residual-based variance parameters from pre-existing data. My procedure resolves such issues, thus providing a framework for accurate power calculation with ANCOVA.

Keywords: power calculation; experimental design; panel data; ANCOVA (search for similar items in EconPapers)
JEL-codes: B40 C23 C90 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2020-06, Revised 2021-11
New Economics Papers: this item is included in nep-ecm, nep-exp and nep-ore
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Citations: View citations in EconPapers (2)

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