Estimation and inference for policy relevant treatment effects

Yuya Sasaki and Takuya Ura

Journal of Econometrics, 2023, vol. 234, issue 2, 394-450

Abstract: The policy relevant treatment effect (PRTE) measures the average effect of switching from a status-quo policy to a counterfactual policy under consideration. Estimation of the PRTE involves estimation of multiple preliminary parameters, including propensity scores, conditional expectation functions of the outcome and covariates given the propensity score, and marginal treatment effects. These preliminary estimators can affect the asymptotic distribution of the PRTE estimator in complicated and intractable manners. In this light, we propose an orthogonal score for double debiased estimation of the PRTE, whereby the asymptotic distribution of the PRTE estimator is obtained without any influence of preliminary parameter estimators as far as they satisfy mild requirements of convergence rates. To our knowledge, this paper is the first to develop limit distribution theories for inference about the PRTE.

Keywords: Double debiased estimation; Orthogonal score; Policy relevant treatment effects (search for similar items in EconPapers)
JEL-codes: C14 C21 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:econom:v:234:y:2023:i:2:p:394-450

DOI: 10.1016/j.jeconom.2021.03.015

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