Toggling the Defiers to Relax Monotonicity: The Difference-in-Instrumental-Variables Estimand

Johann Caro-Burnett

Papers from arXiv.org

Abstract: Standard instrumental variables (IV) methods identify a Local Average Treatment Effect under monotonicity, which rules out defiers. In many empirical environments, however, distinct instruments may induce heterogeneous and even opposing behavioral responses. This paper introduces the Difference-in-Instrumental-Variables (DIIV) estimand, which exploits two instruments with opposing compliance patterns to recover a point-identified and behaviorally interpretable causal effect without imposing monotonicity. The estimand yields a convex combination of the marginal treatment effects on compliers and defiers, with weights reflecting differential shifts in treatment take-up across instruments. When monotonicity holds, DIIV coincides with the standard IV estimand. The approach can be implemented using simple linear transformations and standard two-stage least squares procedures. Applications using replication data illustrate its applicability in practice.

Date: 2026-02
New Economics Papers: this item is included in nep-ecm
References: Add references at CitEc
Citations:

Downloads: (external link)
http://arxiv.org/pdf/2602.12504 Latest version (application/pdf)

Related works:
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:arx:papers:2602.12504

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().