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IPW vs PsMatch vs P...
 
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IPW vs PsMatch vs PsMatch 2 module

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(@rahima-noor)
Posts: 25
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In Stata, IPW (Inverse Probability Weighting), psmatch, and psmatch2 are all methods used for propensity score analysis, but they serve slightly different purposes. Here's how they compare:

1. IPW (Inverse Probability Weighting)

  • Concept: Weights each observation by the inverse of the probability of receiving treatment, based on the estimated propensity score.
  • Use case: Creates a pseudo-population where treatment assignment is independent of covariates.
  • Implementation in Stata:
    Estimate propensity scores using logit or probit 
    logit treatment covariates
    predict ps, pr
  • Strengths
    • Uses the entire dataset (no need to drop unmatched units).
    • Can handle high-dimensional covariates better than matching.
  • Limitations:
  • Sensitive to extreme weights (requires trimming).

2. psmatch (Official Stata Module)

  • Concept: Performs nearest neighbor matching based on estimated propensity scores.
  • Use case: Compares treated and control units by selecting similar observations.
  • Implementation:
    psmatch treatment covariates, neighbor(1)

    • Strengths:
      • Provides a straightforward approach to matching.
      • Available in newer Stata versions (Stata 16+).
    • Limitations:
      • Less flexible than psmatch2 in terms of options.
     

3. psmatch2 (User-Written Module)

  • Concept: An advanced matching method that extends psmatch with additional features.
  • Use case: Provides more flexible matching, including nearest neighbor, kernel, and radius matching.
  • Installation:
    ssc install psmatch2

    • Strengths:
      • More matching options (e.g., multiple neighbors, caliper matching).
      • Generates additional diagnostics.
    • Limitations:
      • Requires installation (not built-in).

        Comparison Table

        Method Type Strengths Limitations
        IPW Weighting Uses full sample, better for high-dimensional data Sensitive to extreme weights
        psmatch Matching Official Stata command, simple implementation Less flexible than psmatch2
        psmatch2 Matching More flexible, advanced matching options Requires installation

    Which One to Use?

    • Use IPW if you want to keep all observations and reduce selection bias using weighting.
    • Use psmatch if you prefer a simple, built-in solution.
    • Use psmatch2 if you need more advanced matching techniques and diagnostics.
     

 
Posted : 05/03/2025 1:01 pm
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