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A Framework for Separating Individual-Level Treatment Effects From Spillover Effects

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  • Huber, Martin
  • Steinmayr, Andreas
Abstract
This article suggests a causal framework for separating individual-level treatment effects and spillover effects such as general equilibrium, interference, or interaction effects related to treatment distribution. We relax the stable unit treatment value assumption assuming away treatment-dependent interaction between study participants and permit spillover effects within aggregates, for example, regions. Based on our framework, we systematically categorize the individual-level and spillover effects considered in the previous literature and clarify the assumptions required for identification under different designs, for instance, based on randomization or selection on observables. Furthermore, we propose a novel difference-in-differences approach and apply it to a policy intervention extending unemployment benefit durations in selected regions of Austria that arguably affected ineligibles in treated regions through general equilibrium effects in local labor markets.

Suggested Citation

  • Huber, Martin & Steinmayr, Andreas, 2019. "A Framework for Separating Individual-Level Treatment Effects From Spillover Effects," Munich Reprints in Economics 78220, University of Munich, Department of Economics.
    • Handle: RePEc:lmu:muenar:78220
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    Cited by:

    1. Clarissa Lotti & Arieda Muço & Giancarlo Spagnolo & Tommaso Valletti, 2024. "Indirect Savings from Public Procurement Centralization," American Economic Journal: Economic Policy, American Economic Association, vol. 16(3), pages 347-366, August.
    2. Lafférs, Lukáš & Mellace, Giovanni, 2020. "Identification of the average treatment effect when SUTVA is violated," Discussion Papers on Economics 3/2020, University of Southern Denmark, Department of Economics.
    3. Hoang, Thoa & Noy, Ilan, 2023. "The income consequences of a managed retreat," Regional Science and Urban Economics, Elsevier, vol. 100(C).
    4. Di Iasio, Valentina & Wahba, Jackline, 2023. "Expecting Brexit and UK migration: Should I go?," European Economic Review, Elsevier, vol. 157(C).
    5. Roberta Di Stefano & Giovanni Mellace, 2020. "The inclusive synthetic control method," Working Papers 21/20, Sapienza University of Rome, DISS.
    6. Roulleau-Pasdeloup, Jordan, 2020. "A Puncher’s chance: Expected gain and risk taking in a market for superstars," Labour Economics, Elsevier, vol. 66(C).
    7. Viviana Celli, 2022. "Causal mediation analysis in economics: Objectives, assumptions, models," Journal of Economic Surveys, Wiley Blackwell, vol. 36(1), pages 214-234, February.
    8. Ulrike Unterhofer & Conny Wunsch, 2022. "Macroeconomic Effects of Active Labour Market Policies: A Novel Instrumental Variables Approach," Papers 2211.12437, arXiv.org.
    9. Fiorini, Mario & Lee, Wooyong & Pfeifer, Gregor, 2024. "A Simple Approach to Staggered Difference-in-Differences in the Presence of Spillovers," IZA Discussion Papers 16868, Institute of Labor Economics (IZA).
    10. Roth, Jonathan & Sant’Anna, Pedro H.C. & Bilinski, Alyssa & Poe, John, 2023. "What’s trending in difference-in-differences? A synthesis of the recent econometrics literature," Journal of Econometrics, Elsevier, vol. 235(2), pages 2218-2244.
    11. Lehner, Lukas & Kasy, Maximilian, 2022. "Employing the unemployed of Marienthal: Evaluation of a guaranteed job program," INET Oxford Working Papers 2022-29, Institute for New Economic Thinking at the Oxford Martin School, University of Oxford.
    12. Mate Kormos & Robert P. Lieli & Martin Huber, 2023. "Treatment Effect Analysis for Pairs with Endogenous Treatment Takeup," Papers 2301.04876, arXiv.org.
    13. Mäkinen, Taneli & Li, Fan & Mercatanti, Andrea & Silvestrini, Andrea, 2022. "Causal analysis of central bank holdings of corporate bonds under interference," Economic Modelling, Elsevier, vol. 113(C).
    14. Henrika Langen & Martin Huber, 2022. "How causal machine learning can leverage marketing strategies: Assessing and improving the performance of a coupon campaign," Papers 2204.10820, arXiv.org, revised Jun 2022.
    15. Andrii Melnychuk, 2024. "Synthetic Controls with spillover effects: A comparative study," Papers 2405.01645, arXiv.org.
    16. Greenaway-McGrevy, Ryan & Phillips, Peter C.B., 2023. "The impact of upzoning on housing construction in Auckland," Journal of Urban Economics, Elsevier, vol. 136(C).
    17. Fangting Chi & Haoying Han, 2023. "The Impact of High-Speed Rail on Economic Development: A County-Level Analysis," Land, MDPI, vol. 12(4), pages 1-22, April.
    18. Wang, Lu & Ruan, Hang & Hong, Yanran & Luo, Keyu, 2023. "Detecting the hidden asymmetric relationship between crude oil and the US dollar: A novel neural Granger causality method," Research in International Business and Finance, Elsevier, vol. 64(C).
    19. Giulio Grossi & Marco Mariani & Alessandra Mattei & Patrizia Lattarulo & Ozge Oner, 2020. "Direct and spillover effects of a new tramway line on the commercial vitality of peripheral streets. A synthetic-control approach," Papers 2004.05027, arXiv.org, revised Nov 2023.

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