arXiv subjects

Haitian Xie

Publications and source records attributed to Haitian Xie.

21 records · Page 2Linked to original sources

arXiv2022

Personalized Subsidy Rules

Subsidies are commonly used to encourage behaviors that can lead to short- or long-term benefits. Typical examples include subsidized job training programs and provisions of preventive health products, in which both behavioral responses and associated gains can exhibit heterogeneity. This study uses the marginal treatment effect (MTE) framework to study personalized assignments of subsidies based on individual characteristics. First, we derive the optimality condition for a welfare-maximizing subsidy rule by showing that the welfare can be represented as a function of the MTE. Next, we show that subsidies generally result in better welfare than directly mandating the encouraged behavior because subsidy rules implicitly target individuals through unobserved heterogeneity in the behavioral response. When there is positive selection, that is, when individuals with higher returns are more likely to select the encouraged behavior, the optimal subsidy rule achieves the first-best welfare, which is the optimal welfare if a policy-maker can observe individuals' private information. We then provide methods to (partially) identify the optimal subsidy rule when the MTE is identified and unidentified. Particularly, positive selection allows for the point identification of the optimal subsidy rule even when the MTE curve is not. As an empirical application, we study the optimal wage subsidy using the experimental data from the Jordan New Opportunities for Women pilot study.

econ.EM↗

arXiv2022

Finite-Sample Average Bid Auction

The paper studies the problem of auction design in a setting where the auctioneer accesses the knowledge of the valuation distribution only through statistical samples. A new framework is established that combines the statistical decision theory with mechanism design. Two optimality criteria, maxmin, and equivariance, are studied along with their implications on the form of auctions. The simplest form of the equivariant auction is the average bid auction, which set individual reservation prices proportional to the average of other bids and historical samples. This form of auction can be motivated by the Gamma distribution, and it sheds new light on the estimation of the optimal price, an irregular parameter. Theoretical results show that it is often possible to use the regular parameter population mean to approximate the optimal price. An adaptive average bid estimator is developed under this idea, and it has the same asymptotic properties as the empirical Myerson estimator. The new proposed estimator has a significantly better performance in terms of value at risk and expected shortfall when the sample size is small.

econ.EM↗

arXiv2022

Efficient and Robust Estimation of the Generalized LATE Model

This paper studies the estimation of causal parameters in the generalized local average treatment effect (GLATE) model, a generalization of the classical LATE model encompassing multi-valued treatment and instrument. We derive the efficient influence function (EIF) and the semiparametric efficiency bound (SPEB) for two types of parameters: local average structural function (LASF) and local average structural function for the treated (LASF-T). The moment condition generated by the EIF satisfies two robustness properties: double robustness and Neyman orthogonality. Based on the robust moment condition, we propose the double/debiased machine learning (DML) estimators for LASF and LASF-T. The DML estimator is semiparametric efficient and suitable for high dimensional settings. We also propose null-restricted inference methods that are robust against weak identification issues. As an empirical application, we study the effects across different sources of health insurance by applying the developed methods to the Oregon Health Insurance Experiment.

econ.EM↗