Causal Identification under Interference: The Role of Treatment Assignment Independence

Julius Owusu and Monika Avila M\'arquez

Papers from arXiv.org

Abstract: Applied researchers often use identification formulas derived under individualistic treatment response (ITR), which rules out interference, even when interference is plausible but unobserved. We characterize what these identification formulas recover under arbitrary interference. For selection on observables, instrumental variables, sharp regression discontinuity, and difference-in-differences, each ITR-based formula equals an average direct effect (ADE)-type estimand plus a bias. Every term of the bias is the product of an interference component and a component measuring how the law of others' assignments differs across the two comparison groups. The bias therefore vanishes under a restriction on the assignment mechanism, generalized conditional assignment independence (CAI), whose design-specific forms include conditions used in the literature. Because generalized CAI cannot generally be tested from the single realization of the assignment vector observed in data, we develop a sensitivity analysis that relaxes it and derive identified sets, together with the corresponding breakdown frontiers and breakdown points, under arbitrary interference. When interference is anonymous and operates through a treated share, the structure yields tighter bounds indexed by a measure of assignment dependence that can be benchmarked with observed group-level assignment patterns. A calibrated simulation and a reanalysis of a temporary-agency employment study illustrate the paper's theoretical results and proposed sensitivity-analysis procedures.

Date: 2026-04, Revised 2026-10
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