Learning in Games and the Interpretation of Natural Experiments

We show that the treatment effect estimated by standard methods such as regression discontinuity analysis or difference-in-differences may contain a transient “learning effect” is entangled with long-term of treatment. This learning occurs when variable interest agents’ efforts, and control correspond to success failure: failure gives agents information about how much their effort matters, consequently changes amount they provide after examine impact it likely be substantial. (JEL C13, C21, D72, D74, D83, I20)