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Applied and bridge studies study record
Methods & measurementWelfare Decomposition under Heterogeneous Treatment Response: Unifying Identification, Structural Extrapolation, and Sensitivity Analysis
STATUS · Manuscript in progressSSRN · Not yet posted
MECHANISM
Identify the incentive structure and the condition that would falsify the claim.
RULE CHANGE
Read the intervention only after the paper shows how the current payoff space fails to support system welfare.
READER USE
Use the summary to see where private gain creates system exposure, then check the study record.
Contribution — what this adds to the conversation
Provides a formal framework for integrating identification and structural estimation, with clear falsification conditions. Targets top economics journals and grant agencies.
WHAT'S NEW · Novel theorem partitioning welfare into R, E, B components, bridging design-based and structural approaches. Original application of MST to evaluation methodology.
The paper establishes the Welfare Decomposition Theorem, partitioning any policy's welfare change into a reduced-form component (R), a structural extrapolation component (E), and a sensitivity bound (B). Using data from five policy domains, it finds that LATE-only evaluation generates a $200–380 billion annual welfare gap. The paper proposes a reporting mandate for journals and grant agencies to replace LATE-only reporting with the (R,E,B) vector.