Economics
New submissions
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New submissions for Thu, 2 May 24
- [1] arXiv:2405.00161 [pdf, other]
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Title: Estimating Heterogeneous Treatment Effects with Item-Level Outcome Data: Insights from Item Response TheorySubjects: Econometrics (econ.EM); Methodology (stat.ME)
Analyses of heterogeneous treatment effects (HTE) are common in applied causal inference research. However, when outcomes are latent variables assessed via psychometric instruments such as educational tests, standard methods ignore the potential HTE that may exist among the individual items of the outcome measure. Failing to account for "item-level" HTE (IL-HTE) can lead to both estimated standard errors that are too small and identification challenges in the estimation of treatment-by-covariate interaction effects. We demonstrate how Item Response Theory (IRT) models that estimate a treatment effect for each assessment item can both address these challenges and provide new insights into HTE generally. This study articulates the theoretical rationale for the IL-HTE model and demonstrates its practical value using data from 20 randomized controlled trials in economics, education, and health. Our results show that the IL-HTE model reveals item-level variation masked by average treatment effects, provides more accurate statistical inference, allows for estimates of the generalizability of causal effects, resolves identification problems in the estimation of interaction effects, and provides estimates of standardized treatment effect sizes corrected for attenuation due to measurement error.
- [2] arXiv:2405.00234 [pdf, other]
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Title: Conceiving Naturally After IVF: the effect of assisted reproduction on obstetric interventions and child health at birthSubjects: General Economics (econ.GN)
A growing share of the world's population is being born via assisted reproductive technology (ART), including in-vitro fertilisation (IVF). However, two concerns persist. First, ART pregnancies correlate with predictors of poor outcomes at birth--and it is unclear whether this relationship is causal. Second, the emotional and financial costs associated with ART-use might exacerbate defensive medical behaviour, where physicians intervene more than necessary to reduce the risk of adverse medical outcomes and litigation. We address the challenge of identifying the pure effect of ART-use on both maternal and infant outcomes at birth by leveraging exogenous variation in the success of ART cycles. We compare the obstetric outcomes for ART-conceived births with those of spontaneously-conceived births after a failed ART treatment. Moreover, we flexibly adjust for key confounders using double machine learning. We do this using clinical registry ART data and administrative maternal and infant data from New South Wales (NSW) between 2009-2017. We find that ART slightly decreases the risk of obstetric interventions, lowering the risk of a caesarean section and increasing the rate of spontaneous labour (+3.5 p.p.). Moreover, we find that ART has a statistically and clinically insignificant effect on infant health outcomes.
Keywords: Fertility, Assisted reproduction, IVF, Caesarean Section, Obstetric, Infertility. JEL classification: I10, I12, I19. - [3] arXiv:2405.00235 [pdf, ps, other]
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Title: Blockchain Price vs. Quantity ControlsAuthors: Abdoulaye NdiayeSubjects: General Economics (econ.GN)
This paper studies the optimal transaction fee mechanisms for blockchains, focusing on the distinction between price-based ($\mathcal{P}$) and quantity-based ($\mathcal{Q}$) controls. By analyzing factors such as demand uncertainty, validator costs, cryptocurrency price fluctuations, price elasticity of demand, and levels of decentralization, we establish criteria that determine the selection of transaction fee mechanisms. We present a model framed around a Nash bargaining game, exploring how blockchain designers and validators negotiate fee structures to balance network welfare with profitability. Our findings suggest that the choice between $\mathcal{P}$ and $\mathcal{Q}$ mechanisms depends critically on the blockchain's specific technical and economic features. The study concludes that no single mechanism suits all contexts and highlights the potential for hybrid approaches that adaptively combine features of both $\mathcal{P}$ and $\mathcal{Q}$ to meet varying demands and market conditions.
- [4] arXiv:2405.00247 [pdf, other]
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Title: The value of non-traditional credentials in the labor marketSubjects: General Economics (econ.GN)
This study investigates the labor market value of credentials obtained from Massive Open Online Courses (MOOCs) and shared on business networking platforms. We conducted a randomized experiment involving more than 800,000 learners, primarily from developing countries and without college degrees, who completed technology or business-related courses on the Coursera platform between September 2022 and March 2023. The intervention targeted learners who had recently completed their courses, encouraging them to share their credentials and simplifying the sharing process. One year after the intervention, we collected data from LinkedIn profiles of approximately 40,000 experimental subjects. We find that the intervention leads to an increase of 17 percentage points for credential sharing. Further, learners in the treatment group were 6\% more likely to report new employment within a year, with an 8\% increase in jobs related to their certificates. This effect was more pronounced among LinkedIn users with lower baseline employability. Across the entire sample, the treated group received a higher number of certificate views, indicating an increased interest in their profiles. These results suggest that facilitating credential sharing and reminding learners of the value of skill signaling can yield significant gains. When the experiment is viewed as an encouragement design for credential sharing, we can estimate the local average treatment effect (LATE) of credential sharing (that is, the impact of credential sharing on the workers induced to share by the intervention) for the outcome of getting a job. The LATE estimates are imprecise but large in magnitude; they suggest that credential sharing more than doubles the baseline probability of getting a new job in scope for the credential.
- [5] arXiv:2405.00424 [pdf, other]
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Title: Optimal Bias-Correction and Valid Inference in High-Dimensional Ridge Regression: A Closed-Form SolutionAuthors: Zhaoxing GaoComments: 53 pages, 10 figuresSubjects: Econometrics (econ.EM); Methodology (stat.ME); Machine Learning (stat.ML)
Ridge regression is an indispensable tool in big data econometrics but suffers from bias issues affecting both statistical efficiency and scalability. We introduce an iterative strategy to correct the bias effectively when the dimension $p$ is less than the sample size $n$. For $p>n$, our method optimally reduces the bias to a level unachievable through linear transformations of the response. We employ a Ridge-Screening (RS) method to handle the remaining bias when $p>n$, creating a reduced model suitable for bias-correction. Under certain conditions, the selected model nests the true one, making RS a novel variable selection approach. We establish the asymptotic properties and valid inferences of our de-biased ridge estimators for both $p< n$ and $p>n$, where $p$ and $n$ may grow towards infinity, along with the number of iterations. Our method is validated using simulated and real-world data examples, providing a closed-form solution to bias challenges in ridge regression inferences.
- [6] arXiv:2405.00522 [pdf, other]
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Title: DAM: A Universal Dual Attention Mechanism for Multimodal Timeseries Cryptocurrency Trend ForecastingSubjects: General Economics (econ.GN)
In the distributed systems landscape, Blockchain has catalyzed the rise of cryptocurrencies, merging enhanced security and decentralization with significant investment opportunities. Despite their potential, current research on cryptocurrency trend forecasting often falls short by simplistically merging sentiment data without fully considering the nuanced interplay between financial market dynamics and external sentiment influences. This paper presents a novel Dual Attention Mechanism (DAM) for forecasting cryptocurrency trends using multimodal time-series data. Our approach, which integrates critical cryptocurrency metrics with sentiment data from news and social media analyzed through CryptoBERT, addresses the inherent volatility and prediction challenges in cryptocurrency markets. By combining elements of distributed systems, natural language processing, and financial forecasting, our method outperforms conventional models like LSTM and Transformer by up to 20\% in prediction accuracy. This advancement deepens the understanding of distributed systems and has practical implications in financial markets, benefiting stakeholders in cryptocurrency and blockchain technologies. Moreover, our enhanced forecasting approach can significantly support decentralized science (DeSci) by facilitating strategic planning and the efficient adoption of blockchain technologies, improving operational efficiency and financial risk management in the rapidly evolving digital asset domain, thus ensuring optimal resource allocation.
- [7] arXiv:2405.00561 [pdf, ps, other]
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Title: A Taste for VarietySubjects: Theoretical Economics (econ.TH)
A decision maker repeatedly chooses one of a finite set of actions. In each period, the decision maker's payoff depends on fixed basic payoff of the chosen action and the frequency with which the action has been chosen in the past. We analyze optimal strategies associated with three types of evaluations of infinite payoffs: discounted present value, the limit inferior, and the limit superior of the partial averages. We show that when the first two are the evaluation schemes, a stationary strategy can always achieve the best possible outcome. However, for the latter evaluation scheme, a stationary strategy can achieve the best outcome only if all actions that are chosen with strictly positive frequency by an optimal stationary strategy have the same basic payoff.
Cross-lists for Thu, 2 May 24
- [8] arXiv:2405.00188 (cross-list from stat.AP) [pdf, other]
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Title: A Revisit of the Optimal Excess-of-Loss ContractSubjects: Applications (stat.AP); Theoretical Economics (econ.TH)
It is well-known that Excess-of-Loss reinsurance has more marketability than Stop-Loss reinsurance, though Stop-Loss reinsurance is the most prominent setting discussed in the optimal (re)insurance design literature. We point out that optimal reinsurance policy under Stop-Loss leads to a zero insolvency probability, which motivates our paper. We provide a remedy to this peculiar property of the optimal Stop-Loss reinsurance contract by investigating the optimal Excess-of-Loss reinsurance contract instead. We also provide estimators for the optimal Excess-of-Loss and Stop-Loss contracts and investigate their statistical properties under many premium principle assumptions and various risk preferences, which according to our knowledge, have never been investigated in the literature. Simulated data and real-life data are used to illustrate our main theoretical findings.
- [9] arXiv:2405.00540 (cross-list from cs.CY) [pdf, other]
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Title: Heat, Health, and Habitats: Analyzing the Intersecting Risks of Climate and Demographic Shifts in Austrian DistrictsSubjects: Computers and Society (cs.CY); General Economics (econ.GN); Atmospheric and Oceanic Physics (physics.ao-ph)
The impact of hot weather on health outcomes of a population is mediated by a variety of factors, including its age profile and local green infrastructure. The combination of warming due to climate change and demographic aging suggests that heat-related health outcomes will deteriorate in the coming decades. Here, we measure the relationship between weekly all-cause mortality and heat days in Austrian districts using a panel dataset covering $2015-2022$. An additional day reaching $30$ degrees is associated with a $2.4\%$ increase in mortality per $1000$ inhabitants during summer. This association is roughly doubled in districts with a two standard deviation above average share of the population over $65$. Using forecasts of hot days (RCP) and demographics in $2050$, we observe that districts will have elderly populations and hot days $2-5$ standard deviations above the current mean in just $25$ years. This predicts a drastic increase in heat-related mortality. At the same time, district green scores, measured using $10\times 10$ meter resolution satellite images of residential areas, significantly moderate the relationship between heat and mortality. Thus, although local policies likely cannot reverse warming or demographic trends, they can take measures to mediate the health consequences of these growing risks, which are highly heterogeneous across regions, even in Austria.
Replacements for Thu, 2 May 24
- [10] arXiv:1902.09608 (replaced) [pdf, other]
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Title: On BinscatterJournal-ref: American Economic Review, 114(5) 1488-1514, 2024Subjects: Econometrics (econ.EM); Methodology (stat.ME); Machine Learning (stat.ML)
- [11] arXiv:2205.05546 (replaced) [pdf, other]
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Title: The Limits of Limited CommitmentSubjects: Theoretical Economics (econ.TH)
- [12] arXiv:2206.01040 (replaced) [pdf, other]
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Title: Continuous space core-periphery model with transport costs in differentiated agricultureAuthors: Kensuke OhtakeComments: 35 pages, 23 figuresSubjects: Theoretical Economics (econ.TH); Dynamical Systems (math.DS)
- [13] arXiv:2206.04424 (replaced) [pdf, other]
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Title: Estimating the Gains (and Losses) of Revenue ManagementComments: 79 pages (the appendix starts at p.42)Subjects: General Economics (econ.GN)
- [14] arXiv:2307.07015 (replaced) [pdf, other]
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Title: Advertiser Learning in Direct Advertising MarketsSubjects: General Economics (econ.GN)
- [15] arXiv:2309.09299 (replaced) [pdf, other]
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Title: Bounds on Average Effects in Discrete Choice Panel Data ModelsSubjects: Econometrics (econ.EM)
- [16] arXiv:2311.08650 (replaced) [pdf, ps, other]
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Title: The Use of Symmetry for Models with Variable-size VariablesAuthors: Takeshi FukasawaSubjects: General Economics (econ.GN)
- [17] arXiv:2312.14191 (replaced) [pdf, ps, other]
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Title: Noisy Measurements Are Important, the Design of Census Products Is Much More ImportantAuthors: John M. AbowdJournal-ref: Harvard Data Science Review, Volume 6, Number 2 (Spring, 2024)Subjects: Cryptography and Security (cs.CR); Econometrics (econ.EM); Applications (stat.AP)
- [18] arXiv:2401.00264 (replaced) [pdf, ps, other]
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Title: Identification of Nonlinear Dynamic Panels under Partial StationaritySubjects: Econometrics (econ.EM)
- [19] arXiv:2403.07928 (replaced) [pdf, other]
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Title: Strategic Bidding in Knapsack AuctionsSubjects: Computer Science and Game Theory (cs.GT); Theoretical Economics (econ.TH)
- [20] arXiv:2404.02426 (replaced) [pdf, other]
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Title: Equilibrium in Style: A Modeling Framework on the Cash Flow and the Life Cycle of a Consumer StoreComments: 44 pages, 12 figuresSubjects: Theoretical Economics (econ.TH)
- [21] arXiv:2404.18709 (replaced) [pdf, other]
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Title: Three-state Opinion Dynamics for Financial Markets on Complex NetworksAuthors: Bernardo J. Zubillaga, Mateus F. B. Granha, André L. M. Vilela, Chao Wang, Kenric P. Nelson, H. Eugene StanleyComments: 15 pages, 14 figuresSubjects: Physics and Society (physics.soc-ph); Statistical Mechanics (cond-mat.stat-mech); General Economics (econ.GN)
- [22] arXiv:2404.19145 (replaced) [pdf, other]
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Title: Orthogonal Bootstrap: Efficient Simulation of Input UncertaintySubjects: Methodology (stat.ME); Machine Learning (cs.LG); Econometrics (econ.EM); Statistics Theory (math.ST); Machine Learning (stat.ML)
- [23] arXiv:2404.19623 (replaced) [pdf, other]
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Title: Level-$k$ Reasoning, Cognitive Hierarchy, and RationalizabilityAuthors: Shuige LiuSubjects: Theoretical Economics (econ.TH)
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