This article presents a latent class model for multilevel data to identify latent subgroups and estimate heterogeneous treatment effects. Unlike sequential approaches that partition data first and then estimate average treatment effects (ATEs) within classes, we employ a Bayesian procedure to jointly estimate mixing probability, selection, and…

There has been increasing interest in exploring heterogeneous treatment effects using machine learning (ML) methods such as causal forests, Bayesian additive regression trees, and targeted maximum likelihood estimation. However, there is little work on applying these methods to estimate treatment effects in latent classes defined by…