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Testing Rank Similarity

Brigham Frandsen; Lars Lefgren

Brigham Young University

The Review of Economics and Statistics 2018

We introduce a test of the rank invariance or rank similarity assumption common in treatment effects and instrumental variables models. The test probes the implication that the conditional distribution of ranks should be identical across treatment states using a regression-based test statistic. We apply the test to data from the Tennessee STAR class-size reduction experiment and show that systematic slippages in rank can be important statistically and economically.

DOI
10.1162/rest_a_00675
Volume
100 (1)
Pages
86-91
Language
en
Export
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