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Regression Discontinuity - Institute for Policy Research

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What to do about fuzzy allocation?<br />

• RDD as an instrumental variable<br />

– Provides causal estimates if instrument is correlated with treatment<br />

and not with errors in the outcome.<br />

– Proof: Hahn, Todd, and van der Klaauw, 2001<br />

– Examples: Angrist & Lavy, 1999; Jacob and Lefgren, 2004a, 2004b;<br />

van der Klaauw, 2002<br />

– In this case, we implemented in a regression (two stage least<br />

squares) framework as opposed to the non-parametric wald<br />

estimator

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