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Title: On Binscatter
Binscatter is a popular method for visualizing bivariate relationships and conducting informal specification testing. We study the properties of this method formally and develop enhanced visualization and econometric binscatter tools. These include estimating conditional means with optimal binning and quantifying uncertainty. We also highlight a methodological problem related to covariate adjustment that can yield incorrect conclusions. We revisit two applications using our methodology and find substantially different results relative to those obtained using prior informal binscatter methods. General purpose software in Python, R, and Stata is provided. Our technical work is of independent interest for the nonparametric partition-based estimation literature. (JEL C13, C14, C18, C51, O31, R32)  more » « less
Award ID(s):
2241575 2019432 1947805
PAR ID:
10505081
Author(s) / Creator(s):
; ; ;
Publisher / Repository:
AEA
Date Published:
Journal Name:
American Economic Review
Volume:
114
Issue:
5
ISSN:
0002-8282
Page Range / eLocation ID:
1488 to 1514
Format(s):
Medium: X
Sponsoring Org:
National Science Foundation
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