Econometrics term paper ideas

The first-order conditions for OLS and the logit MLE imply a nice property: if you compute an “untreated” predicted probability for each person, using her actual covariate values but setting the treatment dummy to 0, then the average “untreated” prediction in the control group equals the raw control mean. In large enough samples, this will be very similar to the average “untreated” prediction in the full sample (since the distribution of covariates in the control group will resemble the distribution in the full sample). The latter is a regression-adjusted control mean. So we have an adjusted control mean that enjoys the same consistency properties as the raw control mean.

Econometrics term paper ideas

econometrics term paper ideas

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