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Unobservable Selection and Coefficient Stability: Theory and Validation

Open access
Oster, Emily·2013·National Bureau of Economic Research

Abstract

A common heuristic for evaluating robustness of results to omitted variable bias is to look at coefficient movements after inclusion of controls.This heuristic is informative only if selection on observables is proportional to selection on unobservables.I formalize this link, drawing on theory in Altonji, Elder and Taber (2005) and show how, with this assumption, coefficient movements, along with movements in R-squared values, can be used to calculate omitted variable bias.I discuss empirical implementation and describe a formal bounding argument to replace the coefficient movement heuristic.I show two validation exercises suggesting that this bounding argument would perform well empirically.I discuss application of this procedure to a large set of publications in economics, and use evidence from randomized studies to draw guidelines as to appropriate bounding values.

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Metadata

Authors
Oster, E.
Venue
National Bureau of Economic Research
Published
2013-05
OpenAlex
W1481927355
Cited by
245
References
7
Type
report
Language
en
Open access
green

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CoChat. (2026). Citation check: Unobservable Selection and Coefficient Stability: Theory and Validation. https://app.cochat.ai/papers/10.3386/w19054
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Oster, E. (2013). Unobservable Selection and Coefficient Stability: Theory and Validation. National Bureau of Economic Research. https://doi.org/10.3386/w19054

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