Boy has the last week been a joy ride. I was working through this 2022 Restat article, as I said, by Tymon Słoczyński from Brandeis and trying super hard to get a simulation going that I thought would illustrate something cool, but I learned I had unknowingly created the funkiest data generating process and just had no idea why, just kept working at it. But, eventually I learned a thing or two and made a new data generating process and this one better satisfied the key assumptions in Tymons theorem. So today I’ll walk you through the causal interpretation of the theorem using a simulation and then I’ll conclude with comparing a few estimators.

**Restatement of the OLS Theorem**

We will be working with this OLS model:

Out focus is on the least squares estimate of *tau*. Tymon shows that under some assumptions, the OLS coefficient on *D* is equal to a weighted avera…

## Keep reading with a 7-day free trial

Subscribe to Scott's Substack to keep reading this post and get 7 days of free access to the full post archives.