Abadie’s Kappa and Weighting Estimators of the Local Average Treatment Effect

Citations of this article
Mendeley users who have this article in their library.
Get full text


Recent research has demonstrated the importance of flexibly controlling for covariates in instrumental variables estimation. In this article we study the finite sample and asymptotic properties of various weighting estimators of the local average treatment effect (LATE), motivated by Abadie’s kappa theorem and offering the requisite flexibility relative to standard practice. We argue that two of the estimators under consideration, which are weight normalized, are generally preferable. Several other estimators, which are unnormalized, do not satisfy the properties of scale invariance with respect to the natural logarithm and translation invariance, thereby exhibiting sensitivity to the units of measurement when estimating the LATE in logs and the centering of the outcome variable more generally. We also demonstrate that, when noncompliance is one sided, certain weighting estimators have the advantage of being based on a denominator that is strictly greater than zero by construction. This is the case for only one of the two normalized estimators, and we recommend this estimator for wider use. We illustrate our findings with a simulation study and three empirical applications, which clearly document the sensitivity of unnormalized estimators to how the outcome variable is coded. We implement the proposed estimators in the Stata package kappalate.




Słoczyński, T., Uysal, S. D., & Wooldridge, J. M. (2024). Abadie’s Kappa and Weighting Estimators of the Local Average Treatment Effect. Journal of Business and Economic Statistics. https://doi.org/10.1080/07350015.2024.2332763

Register to see more suggestions

Mendeley helps you to discover research relevant for your work.

Already have an account?

Save time finding and organizing research with Mendeley

Sign up for free