TY  - RPRT
        AU  - Mogstad, Magne
AU  - Wiswall, Matthew
        TI  - How Much Should We Trust Linear Instrumental Variables Estimators? An Application to Family Size and Children's Education
        PY  - 2009/Nov/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 4562
        UR  - https://www.iza.org/publications/dp4562
        AB  - Many empirical studies specify outcomes as a linear function of endogenous regressors when conducting instrumental variable (IV) estimation. We show that tests for treatment effects, selection bias, and treatment effect heterogeneity are biased if the true relationship is non-linear. These results motivate a re-examination of recent evidence suggesting no causal effect of family size on children's education. Following common practice, a linear IV estimator has been used, assuming constant marginal effects of additional children across family sizes. We find that the conclusion of no effect of family size is an artifact of the linear specification, which masks substantial marginal family size effects.
        KW  - instrumental variables
KW  - variable treatment intensity
KW  - treatment effect heterogeneity
KW  - selection bias
KW  - quantity-quality
KW  - family size
KW  - child outcome
        ER  -