Regression discontinuity designs in economics

TitleRegression discontinuity designs in economics
Publication TypeJournal Article
Year of Publication2010
AuthorsLee DS, Lemieux T
JournalJournal of economic literature
Pagination - 355
Date PublishedJun 2010
ISBN Number0022-0515, 0022-0515
KeywordsApplied economics, Design, Economic theory, Economics, Empirical research, Financial analysis, Regression analysis

This paper provides an introduction and "user guide" to Regression Discontinuity (RD) designs for empirical researchers. It presents the basic theory behind the research design, details when RD is likely to be valid or invalid given economic incentives, explains why it is considered a "quasi-experimental" design, and summarizes different ways (with their advantages and disadvantages) of estimating RD designs and the limitations of interpreting these estimates. Concepts are discussed using examples drawn from the growing body of empirical research using RD.