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Implementing Propensity Score Matching with Network Data: The effect of GATT on bilateral trade

Presented by: 
Luca De Benedictis Università di Macerata
Thursday 25th August 2016 - 14:50 to 15:30
INI Seminar Room 1
Co-authors: Bruno Arpino, Alessandra Mattei  

Motivated by the evaluation of the causal effect of the General Agreement on Tariffs
and Trade on bilateral international trade flows, we investigate the role of network structure in propensity score matching under the assumption of strong ignorability. We study the sensitivity of causal inference with respect to the presence of characteristics of the network in the set of confounders conditional on which strong ignorability is assumed to hold. We find that estimates of the average causal effect are highly sensitive to the presence of node-level network statistics in the set of confounders. Therefore, we argue that estimates may suffer from omitted variable bias when the relational dimension of units is ignored, at least in our application.
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University of Cambridge Research Councils UK
    Clay Mathematics Institute London Mathematical Society NM Rothschild and Sons