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1763统计中等multi partmedium

Which Proposed Instrument Is More Plausible?

题目

You want to estimate the causal effect of quote-update intensity XX on realized spread capture YY.

Candidate instrument A is a randomized gateway assignment decided by the exchange. Candidate instrument B is same-day order-flow imbalance, which also directly moves spread capture.

Which candidate is more plausible as an instrument, and what IV condition fails for the other one?

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你的答案

Plausible Instrument

Failed IV Condition