Decision-theoretic comparison of point-identified LATT and set-valued ATT

Characterize, using a decision-theoretic framework, the region in which the point-identified credible-subpopulation local average treatment effect on the treated (LATT) dominates the set-valued average treatment effect on the treated (ATT), thereby converting the documented scope condition into a formal recommendation.

Background

The paper proposes replacing the conventional ATT with a credible-subpopulation LATT when parallel trends is credible only for selected treatment cohorts. The LATT is point-identified under parallel trends for those selected cohorts, whereas sensitivity analysis for the full ATT produces a set that may be wide and uninformative when some cohorts violate parallel trends. The paper emphasizes that the LATT's advantage depends on the informativeness of pre-treatment trends about post-treatment violations: selecting a narrower subpopulation can improve credibility and precision but reduces scope. The unresolved problem is to formalize this trade-off decision-theoretically by determining when the point-identified LATT is preferable to the set-valued ATT.

References

The principal open question is a decision-theoretic characterization of the region in which the point-identified LATT dominates the set-valued ATT, which would turn the scope condition documented here into a formal recommendation.

— Trading Scope for Credibility in Difference-in-Differences  (2608.16867 - Arora et al., 17 Aug 2026) in Section Conclusion

The implications of this scenario where the treatment effect is considered meaningful for a subset of patients, for example a decision on whether to include such results in a product label, are currently unclear.

— On the use of meaningful score regions to interpret treatment effects on continuous clinical outcome assessments  (2609.24758 - Trigg et al., 21 Sep 2026) in Section 2, “Comparing continuous treatment effects to MSR widths”