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Empirical Likelihood in Causal Inference

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  • Biao Zhang

Abstract

This paper discusses the estimation of average treatment effects in observational causal inferences. By employing a working propensity score and two working regression models for treatment and control groups, Robins et al. (1994, 1995) introduced the augmented inverse probability weighting (AIPW) method for estimation of average treatment effects, which extends the inverse probability weighting (IPW) method of Horvitz and Thompson (1952); the AIPW estimators are locally efficient and doubly robust. In this paper, we study a hybrid of the empirical likelihood method and the method of moments by employing three estimating functions, which can generate estimators for average treatment effects that are locally efficient and doubly robust. The proposed estimators of average treatment effects are efficient for the given choice of three estimating functions when the working propensity score is correctly specified, and thus are more efficient than the AIPW estimators. In addition, we consider a regression method for estimation of the average treatment effects when working regression models for both the treatment and control groups are correctly specified; the asymptotic variance of the resulting estimator is no greater than the semiparametric variance bound characterized by the theory of Robins et al. (1994, 1995). Finally, we present a simulation study to compare the finite-sample performance of various methods with respect to bias, efficiency, and robustness to model misspecification.

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  • Biao Zhang, 2016. "Empirical Likelihood in Causal Inference," Econometric Reviews, Taylor & Francis Journals, vol. 35(2), pages 201-231, February.
    • Handle: RePEc:taf:emetrv:v:35:y:2016:i:2:p:201-231
    DOI: 10.1080/07474938.2013.808490
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