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Beyond LATE with a Discrete Instrument

Author

Listed:
  • Christian N. Brinch
  • Magne Mogstad
  • Matthew Wiswall

Abstract

We show how a discrete instrument can be used to identify the marginal treatment effects under a functional structure that allows for treatment heterogeneity among individuals with the same observed characteristics and self-selection based on the unobserved gain from treatment. Guided by this identification result, we perform a marginal treatment effect analysis of the interaction between the quantity and quality of children. Our estimates reveal that the family size effects vary in magnitude and even sign and that families act as if they possess some knowledge of the idiosyncratic effects in the fertility decision.

Suggested Citation

  • Christian N. Brinch & Magne Mogstad & Matthew Wiswall, 2017. "Beyond LATE with a Discrete Instrument," Journal of Political Economy, University of Chicago Press, vol. 125(4), pages 985-1039.
    • Handle: RePEc:ucp:jpolec:doi:10.1086/692712
    DOI: 10.1086/692712
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    More about this item

    JEL classification:

    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth

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