Good evening everyone,
I am trying to perform a data-driven bandwidth selection using the function rdbwdensity function in the rddensity package.
My end-goal is to determine if there is a causal relationship between the announcement of a government policy and the reduction of specific bond rates. My dependent variable "boc1y" contains daily interest rates and my running variable "days" is a time index representing the day associated with a respective interest rate. The policy implementation (I assume this would be attributed as the cutoff), takes place on day 497.
I'm not really familiar with the output of the rdbwdensity function. Intuitively, I'd like to have an interval of days (Ex. days = 360 to days 520) that represents an approximately random distribution of the daily interest rates associated with boc1y.
This is my first time posting on this discussion board and I don't know if I'm really providing enough information to be helpful. I'm always open to dialog so if you have some feedback, please feel free to share.