Inference with few treated units
Econometrics
2026-05-22 v3
Abstract
In many causal inference applications, only one or a few units (or clusters of units) are treated. An important challenge in such settings is that standard inference methods relying on asymptotic theory may be unreliable, even with large total sample sizes. This survey reviews and categorizes inference methods designed to accommodate few treated units, considering cross-sectional and panel data methods. We discuss trade-offs and connections between different approaches. In doing so, we propose slight modifications to improve the finite-sample performance of some methods, and we also provide theoretical justifications for existing heuristic approaches that have been proposed in the literature.
Cite
@article{arxiv.2504.19841,
title = {Inference with few treated units},
author = {Luis Alvarez and Bruno Ferman and Kaspar Wüthrich},
journal= {arXiv preprint arXiv:2504.19841},
year = {2026}
}