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Taking an Extra Moment to Consider Treatment Effects on Distributions

Author

Listed:
  • Gawain Heckley

    (Health Economics, Faculty of Medicine, Lund University)

  • Dennis Petrie

    (Centre for Health Economics, Monash Business School, Monash University)

Abstract

This paper presents a flexible method, Parameter Estimation by Raw Moments (PERM), to evaluate a policy’s impact on parameters of the distribution of outcomes. Such parameters include the variance (E[Y2]−E[Y]2), skewness and covariance. While many studies estimate the mean (first moment), PERM extends this to estimate higher order moments, enabling calculation of distribution parameter treatment effects. Two implementations are discussed: regression with controls and DiD with staggered rollout. Applying PERM DiD to a Swedish school reform shows it reduced education inequality but increased earnings variance resulting in a lower covariance between education and earnings.

Suggested Citation

  • Gawain Heckley & Dennis Petrie, 2024. "Taking an Extra Moment to Consider Treatment Effects on Distributions," Papers 2024-18, Centre for Health Economics, Monash University.
    • Handle: RePEc:mhe:chemon:2024-18
    as

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    References listed on IDEAS

    as
    1. Holmlund, Helena, 2007. "A Researcher's Guide to the Swedish Compulsory School Reform," Working Paper Series 9/2007, Stockholm University, Swedish Institute for Social Research.
    2. Heckley, Gawain & Gerdtham, Ulf-G. & Kjellsson, Gustav, 2016. "A general method for decomposing the causes of socioeconomic inequality in health," Journal of Health Economics, Elsevier, vol. 48(C), pages 89-106.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Causal Inference; Policy Evaluation; Distribution Impacts; Income Inequality; Education Inequality;
    All these keywords.

    JEL classification:

    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General

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