Testing Treatment Effect Heterogeneity in Regression Discontinuity Design

Associate Research Fellow at Institute of Economics, Academia Sinica. He earned his PhD of Economics from University of Texas at Austin. His research fields of speacializtion is Economeric theory.

Please see Prof. Hsu's CV for more information.

Treatment effect heterogeneity is frequently studied in regression discontinuity (RD) applications. This paper proposes, under the RD setup, the first set of formal tests for treatment effect heterogeneity among subpopulations with different characteristics. The proposed tests study whether a policy treatment is 1) beneficial for at least some subpopulations defined by covariate values, 2) has any impact on at least some subpopulations, and 3) has a heterogeneous impact across subpopulations. Monte Carlo simulations show good small sample performance of the proposed tests. The empirical section applies the tests to study the impact of attending a better high school and discover interesting patterns of treatment effect heterogeneity neglected by previous studies.