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Optimality of Matched-Pair Designs in Randomized Controlled Trials

Yuehao Bai

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Abstract: In randomized controlled trials (RCTs), treatment is often assigned by stratified randomization. I show that among all stratified randomization schemes which treat all units with probability one half, a certain matched-pair design achieves the maximum statistical precision for estimating the average treatment effect (ATE). In an important special case, the optimal design pairs units according to the baseline outcome. In a simulation study based on datasets from 10 RCTs, this design lowers the standard error for the estimator of the ATE by 10% on average, and by up to 34%, relative to the original designs.

Date: 2022-06
New Economics Papers: this item is included in nep-ecm and nep-exp
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Handle: RePEc:arx:papers:2206.07845