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

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• Luca De Benedictis (Università di Macerata)
• Thursday 25 August 2016, 14:50-15:30
• Seminar Room 1, Newton Institute.

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SNAW02 - Network science and its applications

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.

This talk is part of the Isaac Newton Institute Seminar Series series.

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