Social and Behavioral Sciences Commons^™

Modeling Endogenous Treatment Eects With Heterogeneity: A Bayesian Nonparametric Approach, Xuequn Hu

USF Tampa Graduate Theses and Dissertations

This dissertation explores the estimation of endogenous treatment effects in the presence of heterogeneous responses. A Bayesian Nonparametric approach is taken to model the heterogeneity in treatment effects. Specifically, I adopt the Dirichlet Process Mixture (DPM) model to capture the heterogeneity and show that DPM often outperforms Finite Mixture Model (FMM) in providing more flexible function forms and thus better model fit. Rather than fixing the number of components in a mixture model, DPM allows the data and prior knowledge to determine the number of components in the data, thus providing an automatic mechanism for model selection.

Two DPM models …