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The standardized causal risk difference is 0.4. This differs from the crude (unstandardized) associational difference, which is $(7/10) - (3/10) = 0.4$ in this particular example.
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The standardized causal risk difference is 0.2. In this particular example, this equals the crude (unstandardized) associational difference: $(7/10) - (5/10) = 0.2$.
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::: {.notes}
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In general, the crude association $Pr[Y = 1|A = 1] - Pr[Y = 1|A = 0]$ does **not** equal the standardized causal effect when conditional randomization is used.
@@ -342,35 +342,25 @@ Since all probabilities equal 0.5, all weights equal $1/0.5 = 2$.
- Weighted mean in treated: $7/10 = 0.7$ (since all weights are equal in this balanced design)
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- Weighted mean in untreated: $3/10 = 0.3$
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- IPW estimate: $0.7 - 0.3 = 0.4$
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- Weighted mean in treated: $0.7$
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- Weighted mean in untreated: $0.5$
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- IPW estimate: $0.7 - 0.5 = 0.2$
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::: {.notes}
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In this example, IPW and standardization give the same answer (0.4) because the design is balanced. With equal treatment probabilities within strata and equal numbers in each stratum, the two methods are equivalent.
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In this example, IPW and standardization give the same answer (0.2) because the design is balanced. With equal treatment probabilities within strata and equal numbers in each stratum, the two methods are equivalent.
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In general, standardization and IPW can give different estimates when:
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1. Treatment probabilities vary across strata
@@ -385,9 +375,9 @@ Both methods are consistent (converge to the true causal effect) under the same
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| Feature | Standardization | IPW |
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|---------|----------------|-----|
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|**Idea**| Weight stratum-specific outcomes by population distribution | Create pseudo-population with marginal randomization |
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