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Inference on breakdown frontiers

Publication ,  Journal Article
Masten, MA; Poirier, A
Published in: Quantitative Economics
January 1, 2020

Given a set of baseline assumptions, a breakdown frontier is the boundary between the set of assumptions which lead to a specific conclusion and those which do not. In a potential outcomes model with a binary treatment, we consider two conclusions: First, that ATE is at least a specific value (e.g., nonnegative) and second that the proportion of units who benefit from treatment is at least a specific value (e.g., at least 50%). For these conclusions, we derive the breakdown frontier for two kinds of assumptions: one which indexes relaxations of the baseline random assignment of treatment assumption, and one which indexes relaxations of the baseline rank invariance assumption. These classes of assumptions nest both the point identifying assumptions of random assignment and rank invariance and the opposite end of no constraints on treatment selection or the dependence structure between potential outcomes. This frontier provides a quantitative measure of the robustness of conclusions to relaxations of the baseline point identifying assumptions. We derive (Formula presented.) -consistent sample analog estimators for these frontiers. We then provide two asymptotically valid bootstrap procedures for constructing lower uniform confidence bands for the breakdown frontier. As a measure of robustness, estimated breakdown frontiers and their corresponding confidence bands can be presented alongside traditional point estimates and confidence intervals obtained under point identifying assumptions. We illustrate this approach in an empirical application to the effect of child soldiering on wages. We find that sufficiently weak conclusions are robust to simultaneous failures of rank invariance and random assignment, while some stronger conclusions are fairly robust to failures of rank invariance but not necessarily to relaxations of random assignment.

Duke Scholars

Published In

Quantitative Economics

DOI

EISSN

1759-7331

ISSN

1759-7323

Publication Date

January 1, 2020

Volume

11

Issue

1

Start / End Page

41 / 111

Related Subject Headings

  • 3802 Econometrics
  • 3801 Applied economics
  • 1403 Econometrics
 

Citation

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ICMJE
MLA
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Masten, M. A., & Poirier, A. (2020). Inference on breakdown frontiers. Quantitative Economics, 11(1), 41–111. https://doi.org/10.3982/QE1288
Masten, M. A., and A. Poirier. “Inference on breakdown frontiers.” Quantitative Economics 11, no. 1 (January 1, 2020): 41–111. https://doi.org/10.3982/QE1288.
Masten MA, Poirier A. Inference on breakdown frontiers. Quantitative Economics. 2020 Jan 1;11(1):41–111.
Masten, M. A., and A. Poirier. “Inference on breakdown frontiers.” Quantitative Economics, vol. 11, no. 1, Jan. 2020, pp. 41–111. Scopus, doi:10.3982/QE1288.
Masten MA, Poirier A. Inference on breakdown frontiers. Quantitative Economics. 2020 Jan 1;11(1):41–111.
Journal cover image

Published In

Quantitative Economics

DOI

EISSN

1759-7331

ISSN

1759-7323

Publication Date

January 1, 2020

Volume

11

Issue

1

Start / End Page

41 / 111

Related Subject Headings

  • 3802 Econometrics
  • 3801 Applied economics
  • 1403 Econometrics