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Extreme Treatment Effect: Extrapolating Dose-Response Function into Extreme Treatment Domain

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  • Juraj Bodik

    (Faculty of Business and Economics (HEC Lausanne), University of Lausanne, 1015 Lausanne, Switzerland
    Expertise Center for Climate Extremes (ECCE), University of Lausanne, 1015 Lausanne, Switzerland)

Abstract

The potential outcomes framework serves as a fundamental tool for quantifying causal effects. The average dose–response function μ ( t ) (also called the effect curve) is typically of interest when dealing with a continuous treatment variable (exposure). The focus of this work is to determine the impact of an extreme level of treatment, potentially beyond the range of observed values—that is, estimating μ ( t ) for very large t . Our approach is grounded in the field of statistics known as extreme value theory. We outline key assumptions for the identifiability of the extreme treatment effect. Additionally, we present a novel and consistent estimation procedure that can potentially reduce the dimension of the confounders to at most 3. This is a significant result since typically, the estimation of μ ( t ) is very challenging due to high-dimensional confounders. In practical applications, our framework proves valuable when assessing the effects of scenarios such as drug overdoses, extreme river discharges, or extremely high temperatures on a variable of interest.

Suggested Citation

  • Juraj Bodik, 2024. "Extreme Treatment Effect: Extrapolating Dose-Response Function into Extreme Treatment Domain," Mathematics, MDPI, vol. 12(10), pages 1-36, May.
    • Handle: RePEc:gam:jmathe:v:12:y:2024:i:10:p:1556-:d:1396103
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    References listed on IDEAS

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