Regression Discontinuity Designs Based on Population Thresholds: Pitfalls and Solutions

Andrew C. Eggers, Ronny Freier, Veronica Grembi, Tommaso Nannicini

Research output: Working paperResearch

Abstract

In many countries, important features of municipal government (such as the electoral system, mayors' salaries, and the number of councillors) depend on whether the municipality is above or below arbitrary population thresholds. Several papers have used a regression discontinuity design (RDD) to measure the effects of these threshold-based policies on political and economic outcomes. Using evidence from France, Germany, and Italy, we highlight two common pitfalls that arise in exploiting population-based policies (confounded treatment and sorting) and we provide guidance for detecting and addressing these pitfalls. Even when these problems are present, population-threshold RDD may be the best available research design for studying the effects of certain policies and political institutions.
Original languageEnglish
Place of PublicationBerlin
PublisherDeutsches Institut für Wirtschaftsforschung
Number of pages49
Publication statusPublished - 2015
SeriesDiscussion Papers, Deutsches Institut für Wirtschaftsforschung (DIW Berlin)
Number1503
ISSN1433-0210

Keywords

  • Regression discontinuity design
  • Causal inference
  • Sorting
  • Population thresholds
  • Institutional design

Cite this

Eggers, A. C., Freier, R., Grembi, V., & Nannicini, T. (2015). Regression Discontinuity Designs Based on Population Thresholds: Pitfalls and Solutions. Berlin: Deutsches Institut für Wirtschaftsforschung. Discussion Papers, Deutsches Institut für Wirtschaftsforschung (DIW Berlin), No. 1503
Eggers, Andrew C. ; Freier, Ronny ; Grembi, Veronica ; Nannicini, Tommaso. / Regression Discontinuity Designs Based on Population Thresholds : Pitfalls and Solutions. Berlin : Deutsches Institut für Wirtschaftsforschung, 2015. (Discussion Papers, Deutsches Institut für Wirtschaftsforschung (DIW Berlin); No. 1503).
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Eggers, AC, Freier, R, Grembi, V & Nannicini, T 2015 'Regression Discontinuity Designs Based on Population Thresholds: Pitfalls and Solutions' Deutsches Institut für Wirtschaftsforschung, Berlin.

Regression Discontinuity Designs Based on Population Thresholds : Pitfalls and Solutions. / Eggers, Andrew C.; Freier, Ronny; Grembi, Veronica ; Nannicini, Tommaso.

Berlin : Deutsches Institut für Wirtschaftsforschung, 2015.

Research output: Working paperResearch

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AB - In many countries, important features of municipal government (such as the electoral system, mayors' salaries, and the number of councillors) depend on whether the municipality is above or below arbitrary population thresholds. Several papers have used a regression discontinuity design (RDD) to measure the effects of these threshold-based policies on political and economic outcomes. Using evidence from France, Germany, and Italy, we highlight two common pitfalls that arise in exploiting population-based policies (confounded treatment and sorting) and we provide guidance for detecting and addressing these pitfalls. Even when these problems are present, population-threshold RDD may be the best available research design for studying the effects of certain policies and political institutions.

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KW - Institutional design

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Eggers AC, Freier R, Grembi V, Nannicini T. Regression Discontinuity Designs Based on Population Thresholds: Pitfalls and Solutions. Berlin: Deutsches Institut für Wirtschaftsforschung. 2015.