Optimal selection of the number of control units in kNN algorithm to estimate average treatment effects

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Tác giả: Gustavo García, Daniel Londoño, Andrés Ramírez-Hassan, Raquel Vargas-Correa

Ngôn ngữ: eng

Ký hiệu phân loại: 025.4 Subject analysis and control

Thông tin xuất bản: 2020

Mô tả vật lý:

Bộ sưu tập: Metadata

ID: 165031

Comment: 24 pages, 13 figures, 5 tablesWe propose a simple approach to optimally select the number of control units in k nearest neighbors (kNN) algorithm focusing in minimizing the mean squared error for the average treatment effects. Our approach is non-parametric where confidence intervals for the treatment effects were calculated using asymptotic results with bias correction. Simulation exercises show that our approach gets relative small mean squared errors, and a balance between confidence intervals length and type I error. We analyzed the average treatment effects on treated (ATET) of participation in 401(k) plans on accumulated net financial assets confirming significant effects on amount and positive probability of net asset. Our optimal k selection produces significant narrower ATET confidence intervals compared with common practice of using k=1.
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