19.6 IV and treatment effects

• 2SLS will give different results depending on which IV is used
• people who are more affected get higher weights

terminology

• compliers: effect is in the expected direction (positive weight)

• always-takers/never-takers: completely unaffected by instrument (zero weight)

• defiers: effect is in the opposite direction of the expected (negative weight)

• if all compliers affected the same way: 2SLS gives average treatment effect among compliers

• we need to assume that there are no defiers (negative weight): monotonicity assumption