A review of causal mediation analysis for assessing direct and indirect treatment effects
No 500, FSES Working Papers from Faculty of Economics and Social Sciences, University of Freiburg/Fribourg Switzerland
Mediation analysis aims at evaluating the causal mechanisms through which a treatment or intervention affects an outcome of interest. The goal is to disentangle the total treatment effect into an indirect effect operating through one or several observed intermediate variables, the so-called mediators, as well as a direct effect reflecting any impact not captured by the observed mediator(s). This paper reviews methodological advancements with a particular focus on applications in economics. It defines the parameters of interest, covers various identification strategies, e.g. based on control variables or instruments, and presents sensitivity checks. Furthermore, it discusses several extensions of the standard mediation framework, such as multivalued treatments, mismeasured mediators, and outcome attrition.
Keywords: Mediation; direct effect; indirect effect; sequential conditional independence; instrument (search for similar items in EconPapers)
JEL-codes: C21 (search for similar items in EconPapers)
Pages: 42 pages
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