Propensity Score-Based Methods versus MTE-Based Methods in Causal Inference: Identification, Estimation, and Application

Sociological Methods & Research
Xiang Zhou, Yu Xie

Abstract

Since the seminal introduction of the propensity score by Rosenbaum and Rubin, propensity-score-based (PS-based) methods have been widely used for drawing causal inferences in the behavioral and social sciences. However, the propensity score approach depends on the ignorability assumption: there are no unobserved confounders once observed covariates are taken into account. For situations where this assumption may be violated, Heckman and his associates have recently developed a novel approach based on marginal treatment effects (MTE). In this paper, we (1) explicate consequences for PS-based methods when aspects of the ignorability assumption are violated; (2) compare PS-based methods and MTE-based methods by making a close examination of their identification assumptions and estimation performances; (3) apply these two approaches in estimating the economic return to college using data from NLSY 1979 and discuss their discrepancies in results. When there is a sorting gain but no systematic baseline difference between treated and untreated units given observed covariates, PS-based methods can identify the treatment effect of the treated (TT). The MTE approach performs best when there is a valid and strong instrumental variable (I...Continue Reading

References

Apr 1, 1988·Scandinavian Journal of Work, Environment & Health·S Greenland, C Poole
Feb 12, 1998·Annals of Internal Medicine·D B Rubin
Apr 14, 1999·Proceedings of the National Academy of Sciences of the United States of America·J J Heckman, E J Vytlacil
Sep 26, 2002·Epidemiology·K J Rothman
Apr 7, 2005·Psychological Methods·Gitta H Lubke, Bengt Muthén
Jun 1, 2011·Social Science Research·Shu-Ling Tsai, Yu Xie
Mar 14, 2013·Sociological Methodology·Yu XieBen Jann
Oct 1, 2011·The American Economic Review·Pedro CarneiroEdward Vytlacil

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Citations

Oct 16, 2018·Evaluation Review·Vivian C WongKylie L Anglin
Jul 25, 2019·PloS One·Thomas PlümperEric Neumayer
Apr 13, 2018·Movement Disorders : Official Journal of the Movement Disorder Society·Maria Fiorella ContarinoJacobus J van Hilten
Dec 16, 2021·Science Advances·Siwei ChengMichael Hout

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