Very excited to share this new working paper, joint with @sdellavi.bsky.social, Guido Imbens, and Woojin Kim bsky.app/profile/nber... - ThreadSky

dritzwoller.bsky.social • 11 days ago

Very excited to share this new working paper, joint with @sdellavi.bsky.social, Guido Imbens, and Woojin Kim
https://bsky.app/profile/nber.org/post/3lny327mfot2x

Reposted from NBER

The Thresholding Multiple Outcomes method addresses spatial correlation in regressions by using information from additional outcomes to identify correlated locations, from Stefano DellaVigna, Guido Imbens, Woojin Kim, and @dritzwoller.bsky.social https://www.nber.org/papers/w33716

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dritzwoller.bsky.social•11 days ago

About half of the papers in top-5 economics journals in 2023 analyze data indexed by geographic locations. Typically, these papers handle spatial dependence by clustering SEs at a higher aggregation level or by modeling dependence based on geographic distance (e.g., Conley SEs).

dritzwoller.bsky.social•11 days ago

Are these methods appropriate for the types of dependence that we might expect for economic data? We assess this by collecting 91 U.S. county-level outcomes (unemployment, income, etc) and computing the correlation, across outcomes, between each pair of counties

dritzwoller.bsky.social•11 days ago

Here's a correlogram for counties in CA, NY, and ND, sorted by state and population. Urban counties in CA correlate more strongly with urban counties in NY than with rural counties in CA. Rural CA counties correlate more closely with ND counties than with urban areas within CA.

dritzwoller.bsky.social•11 days ago

This suggests geographic proximity alone inadequately captures spatial dependence. Even adding population as a covariate doesn’t fully resolve the issue. While several covariates predict high correlations, no single factor completely captures the dependence structure.

dritzwoller.bsky.social•11 days ago

The main idea of this paper is to use collections of outcomes, of this form, to identify which location pairs should be allowed to correlate when constructing standard errors in regression problems.

dritzwoller.bsky.social•11 days ago

Our proposed method, Thresholding Multiple Outcomes (TMO), has three steps:
(1) Estimate pairwise correlations across locations using multiple outcomes.

criminologist.bsky.social•10 days ago

@routineactivity.bsky.social

@davidbuil.bsky.social

Possibly of interest - reminds me of other work in multilevel modelling using multiple outcomes for area estimation. (Ian Brunton-Smith did some of this)

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