Seminário de Pesquisa 27/07/2022

Ocorrerá no dia 27/07/2022 às 16h o Seminário de Pesquisa “CRIME AND MISMEASURED PUNISHMENT: MARGINAL TREATMENT EFFECT WITH MISCLASSIFICATION” na área de Economia Aplicada, ministrado pelo professor Vitor Possebom (EESP-FGV)

Autore: Vitor Possebom (EESP-FGV)

Abstract: I partially identify the marginal treatment effect (MTE) function when the treatment variable is misclassified. To do so, I explore three sets of restrictions on the relationship between the instrument, the misclassified treatment and the correctly measured treatment, allowing for dependence between the instrument and the misclassification decision. If the signs of the derivatives of the correctly measured propensity score and the mismeasured one are the same, I identify the sign of the MTE function at every point in the instrument’s support. If those derivatives are close to each other, I bound the MTE function. Finally, by imposing a functional restriction between those two propensity scores, I derive sharp bounds around the MTE function and any weighted average of the MTE function. To illustrate the usefulness of my partial identification method, I analyze the impact of alternative sentences — e.g., fines or community services — on recidivism using random assignment of judges within Brazilian court districts. In this context, misclassification is an issue when the researcher measures the treatment based solely on trial judge’s rulings, ignoring that the Appeals Court may reverse sentences. I show that, when I use the trial judge’s rulings as my misclassified treatment variable, the misclassification bias may be as large as 10% of the MTE function, which can be estimated using the final ruling in each case as my correctly measured treatment variable. Moreover, I show that the proposed bounds contain the MTE function in this empirical example.