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Regression-Discontinuity Design - Institute for Policy Research

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Adding Nonlinear Terms to the Model<br />

• Include nonlinear functions of the assignment<br />

variable in the equation, <strong>for</strong> example:<br />

Y i<br />

= ˆβ 0<br />

+ ˆβ 1<br />

d + ˆβ 2<br />

(z i<br />

− z c<br />

) + ˆβ 3<br />

(z i<br />

− z c<br />

) 2 + e i<br />

Where d is the treatment indicator and z is the assignment variable<br />

• There are many such nonlinear functions, so<br />

selecting the correct one is crucial

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