Bugni, Federico A.; Li, Jia; Li, Qiyuan - In: Quantitative Economics 14 (2023) 1, pp. 37-70
We propose using a permutation test to detect discontinuities in an underlying economic model at a known cutoff point … on the two sides of the cutoff. Critical values are computed via a standard permutation algorithm. Under a high … asymptotic validity of the permutation test, allowing the sizes of the local subsamples to be either be fixed or grow to infinity …