infonet-economy

Treatment analyses based on average outcomes do not immediately generalize to the case of ordered responses because the expectation of an ordinally measured variable does not exist. The proposed remedy in this paper is a shift in focus to distributional effects. Assuming a threshold crossing model on both the ordered potential outcomes and the binary treatment variable, and leaving the distribution of error terms and functional forms unspecified, the paper discusses how the treatment effects can be bounded. The construction of bounds is illustrated in a simulated data example.