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Free Discontinuity Regression: With an Application to the Economic Effects of Internet Shutdowns

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  • Florian Gunsilius
  • David Van Dijcke

Abstract

Discontinuities in regression functions can reveal important insights. In many contexts, like geographic settings, such discontinuities are multivariate and unknown a priori. We propose a non-parametric regression method that estimates the location and size of discontinuities by segmenting the regression surface. This estimator is based on a convex relaxation of the Mumford-Shah functional, for which we establish identification and convergence. We use it to show that an internet shutdown in India resulted in a reduction of economic activity by 25--35%, greatly surpassing previous estimates and shedding new light on the true cost of such shutdowns for digital economies globally.

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  • Florian Gunsilius & David Van Dijcke, 2023. "Free Discontinuity Regression: With an Application to the Economic Effects of Internet Shutdowns," Papers 2309.14630, arXiv.org, revised Jan 2024.
    • Handle: RePEc:arx:papers:2309.14630
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