Matching Estimators
14 important questions on Matching Estimators
What are the assumptions for calculating treatment effects with treatment estimators?
- Overleap assumption.
What variables should be in X?
- Vector X should not include variables which could be influenced by treatment.
Formula ATE in case of matching:
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Formula ATET in case of matching:
Formula matching estimator:
What are the methods to calculate the counterfactual?
- Matching based on closeness to observables.
- Propensity score matching.
Idea exact matching:
Tradeoff nearest neighbour/more neighbours?
- More neighbors --> less variance, because each counterfactual is calculated as average of several observations.
What is the advantage and disadvantage of propensity score matching?
- Propensity score must be estimated, which can be source of bias.
What does the overleap assumption require?
Steps to estimate ATT with propensity score:
2. Estimate the propensity score with logit/probit.
3. Find weights wij based on propensity score. Decide on weighting function wij.
4. Calculate counterfactuals for every i.
5. Compute E(Y0i|Di=1)
What are the advantages of propensity score matching?
+ Imposes minimal structure on the estimation.
What are the disadvantages of propensity score matching?
- Requires common support assumption.
- No general asymptotic theory is available.
What is the regression estimator in case OLS estimator as matching estimator?
The question on the page originate from the summary of the following study material:
- A unique study and practice tool
- Never study anything twice again
- Get the grades you hope for
- 100% sure, 100% understanding
