Instrument-based estimation with binarised treatments: issues and tests for the exclusion restriction
研究了将多值内生处理变量二元化后，工具变量排除限制可能被违反的问题，提出了满足排除限制的假设和检验方法，并应用于大学教育回报的估计。
Summary When estimating local average and marginal treatment effects using instrumental variables (IVs), multivalued endogenous treatments are frequently converted to binary measures, supposedly to improve interpretability or policy relevance. Such binarisation introduces a violation of the IV exclusion if (a) the IV affects the multivalued treatment within support areas below and/or above the threshold and (b) such IV-induced changes in the multivalued treatment affect the outcome. We discuss assumptions that satisfy the IV exclusion restriction with a binarised treatment and permit identifying the average effect of (a) the binarised treatment and (b) unit-level increases in the original multivalued treatment among specific compliers. We derive testable implications of these assumptions and propose tests which we apply to the estimation of the returns to college graduation instrumented by college proximity.