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What Can We Learn From A Doubly Randomized Preference Trial?—An Instrumental Variables Perspective
Author(s) -
Wing Coady,
Clark M. H.
Publication year - 2016
Publication title -
journal of policy analysis and management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.898
H-Index - 84
eISSN - 1520-6688
pISSN - 0276-8739
DOI - 10.1002/pam.21965
Subject(s) - preference , instrumental variable , perspective (graphical) , randomized controlled trial , randomized experiment , completely randomized design , research design , treatment and control groups , control (management) , interpretation (philosophy) , psychology , computer science , econometrics , statistics , economics , medicine , machine learning , artificial intelligence , mathematics , surgery , programming language
The doubly randomized preference trial (DRPT) is a randomized experimental design with three arms: a treatment arm, a control arm, and a preference arm. The design has useful properties that have gone unnoticed in the applied and methodological literatures. This paper shows how to interpret the DRPT design using an instrumental variables (IV) framework. The IV framework reveals that the DRPT separately identifies three different treatment effect parameters: the Average Treatment Effect (ATE), the Average Treatment Effect on the Treated (ATT), and the Average Treatment Effect on the Untreated (ATU). The ATE, ATT, and ATU parameters are important for program evaluation research because in realistic settings many social programs are optional rather than mandatory and some people who are eligible for a program choose not to participate. Most of the paper is concerned with the interpretation of the research design. To make the ideas concrete, the final section provides an empirical example using data from an existing DRPT study.