Questions tagged [difference-in-difference]

It is about the difference-in-difference method which is quite popular for quasi-experimental studies

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Is program evaluation (DiD, RD) a structural estimation?

Consider program evaluation methods such as IV, Diff-in-Diff, and RD. According to Haile (2021): "Typically program evaluation requires more than descriptive analysis: one must counterfactually ...
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Diff-in-diff parallel trends with a positive outcome

I am trying to test for parallel trends when using diff-in-diffs, where my outcome variable is nonnegative (basically a percentage -- the share of subjects with some property). I run into a simple-...
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How to define treatment & control groups properly?

I’m working on a project examining the effect of a 2016 cash transfer on fertility. Who is eligible for the cash? All families with: 2+ children, or 1 low-income or disabled child. The data doesn’t ...
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Difference-in-difference robust to heterogeneous treatment effect - Gendron-Carrier et al. specification

I am trying to extend the results of Gendron-Carrier et al. (2022) article published in the American Economic Journal : Applied Economics which is about the effect of subway opening on pollution. I ...
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Cross sectional survey - difference in difference campaign evaluation

I would like to use two cross sectional surveys to evaluate the impact of a media campaign on public opinions. The problem is how to identify the "untreated" at baseline? Technically ...
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Handling diff in diff with multiple treatments, but each treatment is applied once to differents groups

Say each year I observe the effect of a movie-level treatment on the reviews of 10 movies (1 treated movie and 9 non-treated movies) over two periods (pre and post treatment). Each year, the treatment ...
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Difference in differences with one post and two treatment variables

I want to test the following hypotheses with a difference in differences (DiD) OLS model: 1. The post grant effect on the dependent variable is stronger for patents with at least one rejection than ...
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Do anticipation effects almost always bias the DiD ATE or ATT towards a null result and increase standard errors?

I am trying to implement a difference in difference model. Suppose that some treated units anticipate the treatment. Then, that would mean that they respond to the treatment prior to the treatment ...
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Diff-in-diff treatment problem

I have a cuestion about a possible aplication of a diff in diff in labor economics. I'm thinking for my master's thesis of comparing the effects of a reduction of the payroll tax in Argentina, which ...
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Difference-in differences survival models

I am in a setting where I'd like to estimate the average treatment effect on the treated (ATT) using a cox-proportional hazards model in a DID style setting. I'll adopt the setting of Mastrobuoni and ...
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DiD with 2 groups

I am thinking about a DID approach. Typical DID can be written as follows: $$Y_i=\beta_0+\beta_1D_i+\beta_2T_i+\beta_3 T_i D_i+\epsilon_i$$ $Y_i$ is an outcome, $D_i$ is a binary treatment, and $T_i$ ...
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Testing method for the performance of R&D support program

Suppose that Government aims to initiate R&D support program to firms The objective of the support program is to rise R&D expenditures and productivity. I have the following data variables: Q: ...
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Difference in difference papers that look at multiple cohorts at a point in time?

I'm trying to see if a CCT targeted at school age children can mitigate adverse impact of weather shocks faced in childhood on their wages in adulthood (at age 30 say) using a setting similar to Duflo,...
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Can I use difference in difference if some households in treatment group become part of control group?

I have data on households which can be eligible for a conditional cash transfer (CCT) if household income is below a threshold. The CCT is introduced in year t for eg. Now some households which have ...
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What should we do if we find the anticipation effect?

In the Difference-in-Differences estimator, one key assumption is the anticipation effect, meaning that the real event date maybe a couple of years before the real event year (yearly data). I am ...
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Probit and DiD - Finance

I have been working on a project for a good long time. I am relatively new to finance and regressions in R, so I would be extremely grateful for every response I get. My goal with this task is to ...
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What is the meaning of adding an non-binary interaction variable to a regression?

When examining whether the impact of laws on Y differently in developed countries is to add an interaction variable as here. The general equation is: Leniency_law is a variable of interest in a ...
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DAG for Difference in Difference Studies

I have been looking for DAGs to represent diff-in-diff research designs but did not come across any. How do you represent state/time fixed effects and time-varying effects on a DAG?
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What is the purpose of testing "additional effect" in "strict exogeneity" in Diff-in-Diff?

The strict exogeneity are different in using OLS and Difference-in-Differences (DiD) as pointed here. From a recently published paper of Miller, 2021, in the Reviewing DID Assumption part (sorry I did ...
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How to justify the result of anticipation effect assumption test?

Regarding Difference-in-Difference, the main assumption is the parallel trend satisfication. Regarding the parallel trend test, just simply prove the joint null test of leads coefficients equalling to ...
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What does no anticipation following Athey, 2021?

From a paper of Athey, 2021, Journal of Econometrics, I saw the assumption of no anticipation effect is Assumption 2: For all units i, all time periods t , and for all adoption dates $\alpha$ , such ...
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How to test anticipation effect in Diff-in-Diff following Borusyak, 2021?

In general, two most important assumptions that all Difference-in-Differences must satisfy are "no anticipation effects" and "parallel trend". The parallel trend is tested by ...
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Should we test for an anticipation effect in difference-in-differences when a natural event occurs?

Normally, we test for anticipation effects as an assumption when using difference-in-differences. However, it seems that it is necessary for examining the impact of laws on firms' behaviour. For ...
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What does "inter alia" in "difference-indifference" testing?

today my paper get rejected due to this reason when I used the Difference-in-Difference as my methodology In addition, it would need to address concerns about causal estimates as there are a number ...
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How many leads we use for parallel trends testing in daily data (difference-in-differences)?

In a difference-in-differences setting, if we deal with yearly data, we normally test the parallel trends assumption for 3 or 4 years before the event dates. However, when dealing with daily data, how ...
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Are there any papers which used the event study methodology NOT in a financial market context?

I was advised to implement an event study in the context of air pollution levels after an event had happened. Now my problem is, that I can not really find any introductory literature (or papers), ...
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What can explain a wrong sign on difference-in-difference estimator?

I am trying to estimate the casual impact of treatment T on outcome Y based on an unbalanced panel data. The data consists of two subsamples: subsample A and subsample B. Based on context of the ...
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What are some important papers using difference-in-difference in economics?

I'm new to difference-in-difference method and wanted to familiarize myself with the literature. I'm familiar with Mostly Harmless Econometrics and the papers on DiD discussed in the book. I would ...
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In difference-in-difference method, should I code treatment exposure as 0 or missing for pre treatment rounds?

In my data, there are some pre-treatment rounds, and some post-treatment rounds. I use months of exposure to treatment in my analysis. So for post-treatment rounds, I have positive values for months ...
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How to explain the Difference-in-Difference for two groups two periods to undergraduate students?

I was asked to have a talk with some undergraduate students in an econometrics class regarding the standard Difference-in-Differences. Even I understand what it is and I am quite familiar with it, but ...
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Missing values in difference-in-differences

To give a background of the problem: I'm performing a difference-in-differences analysis to estimate the effect of a treatment, say A. I have a panel data with 5 rounds and about 3000 observations in ...
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Reverse DiD: or using always treated as control

I would be interested also in the generalised case, but let's start with 2x2 to keep it simple. Say you have two groups $i \in \{1,2\}$ and two time periods $t$ and $t-1$, as the classical DiD case. ...
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What shoud we do when the expected treatment overlaps control sample in DID?

In a generalized Difference-in-Differences in Dasgupta,2019 paper, he documented that control countries did not have a leniency law introduced over 2 years before to 5 years after the introduction of ...
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Joint significance test in a difference-in-differences setting

I ran the following difference-in-differences regression in software and have some questions about the interpretation of the resulting coefficients and their (joint) significance: $$ P_{it} = \gamma_i ...
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1 answer
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Two-year difference-in-differences model design

Is there some literature about two-year difference-in-differences (DiD) models? Suppose a policy was implemented in 1982, but not strictly enforced among all people. Can I still estimate a DiD model ...
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In difference-in-differences approach, would it be possible to add a dummy variable indicating whether a data point belong to treatment group?

Since there is the possibility that there are some factors result in whether a data point belong to treatment group, I think we should add a dummy variable indicating whether a data point belong to ...
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1 answer
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Difference-in-Differences on State Sales Tax Rates

In an attempt to evaluate a potential U.S. National Sales tax rate, it was suggested on this forum before that I consider a difference-in-differences on state sales tax rates before and after they ...
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