Regression-Discontinuity Design - Institute for Policy Research

Benefits and Tradeoffs of Option 2
The main advantage is that at each pooling level the
homogeneity of treatment effects can be assessed by
comparing the pooled within‐effect variance with the
corresponding between‐effect variance obtained from the
estimated parameter covariance matrix of the three‐level
model. If effects can be considered as homogeneous, pooling
is warranted, if not different treatment effects may be
reported.
Limitations:
• To get the estimated covariance matrices one must assume
that correlation structures of treatment effects are constant
across grades, cohort, and states.
– Or, one can use Hedges et al. robust standard errors method for
dealing with correlation between estimates.
• Reduced efficiency relative to option 1