Skip to main content

Questions tagged [difference-in-difference]

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

Filter by
Sorted by
Tagged with
2 votes
0 answers
31 views

Diff-in-diff with different treatment years, what would be time dummy for control?

I want to estimate the impact that replications have on the citations. For that, I want to make a staggered diff-in-diff, comparing replicated papers vs non-replicated ones. In my data set I have ...
LauraGonzalezGa's user avatar
2 votes
1 answer
68 views

Difference between unconfoundedness and parallel trends

I understand the unconfoundedness (selection on observables) assumption to be that the expected value of an outcome is independent of treatment after controlling for observed regressors (since these ...
ABCBAA's user avatar
  • 91
1 vote
0 answers
10 views

Should I include location fixed effects if I'm interested in part of the variation across locations when people move?

I have a panel consisting of individuals who moved at some point within the panel's time frame, where the panel ID (id) represents individuals, and the time ID (date) represents days of the year. The ...
llb1706's user avatar
  • 11
1 vote
0 answers
34 views

How to run an event study with many individuals and few observations per individual?

I am trying to run a study on bond issuance, with a specific policy shock that occurred for all units simultaneously. I was planning to use DiD methods, however I'm only observing an individual ...
Ahhhhhhhhh's user avatar
0 votes
0 answers
26 views

For a diff and diff should I use stationary series or non stationary?

I am trying to do a diff and diff analysis on the impact of QE for US (treatment) and Canada (control). What kind of series should I use and what dummys should I include?
user47940's user avatar
1 vote
0 answers
30 views

Difference in difference on election impact on asset prices?

I am looking to research the impact of Brexit on the FTSE100 index. FTSE100 is an stock index of the 100 largest UK companies. The UK also has FTSE250 which is an index of 250 mid-cap companies (not ...
s5s's user avatar
  • 111
1 vote
0 answers
20 views

Stata code for a novel DiD approach and help with inclusion fixed effects to replicates results of Anton et al. (2023)

I am attempting to replicate the methodology proposed by Anton et al. (2023) https://www.nber.org/system/files/working_papers/w30785/w30785.pdf to research the causal impacts of common ownership on ...
Exeter's user avatar
  • 11
2 votes
3 answers
160 views

Event Study and Diff-n-Diff

I'm struggling to understand the difference between Event Studies and Difference-in-Difference regressions. Both seem to have a discreet event that is assumed to cause some change of interest, subject ...
user37250's user avatar
  • 361
1 vote
1 answer
104 views

Diff-in-diff and ATE vs ATT

I understand that the coefficient of the interaction term in a standard diff-in-diff model is the average treatment effect on the treated (ATT). But I was wondering how/when we can derive the average ...
Econ Wanderer's user avatar
0 votes
0 answers
20 views

RDD regression discontinuity

I have a tiny dataset for several countries: Year (2010-2022) , GDP per capita, Subsidy amount - in the second column (fossilf), and a few other variables. The subsidy amount is 0 for several years. ...
Jey's user avatar
  • 1
2 votes
0 answers
60 views

Staggered difference-in-difference for binary outcome and time-to-outcome

I am trying to find out the effect of a training program for employees by answering 2 questions: Does taking training increase the probability of an employee getting promoted? Does taking training ...
yunchan's user avatar
  • 121
1 vote
0 answers
31 views

Unexpected effect of adding a variable to a multivariate regression. How to interpret it?

I'm trying to estimate the effect of a treatment on prices. I have a panel dataset on which I'm using a DiD to estimate treatment effect through a dummy variable that identifies the period during ...
Sam's user avatar
  • 11
0 votes
1 answer
38 views

Difference in Difference - how to choose the control group (difference with no clear trend, parallel series or cointegrated?)

I'd like to use difference in difference methodology to test the impact of a treatment. Being the formula of the regression: ...
GabyLP's user avatar
  • 101
0 votes
0 answers
49 views

Assessing multiple Treatment Effects in Overlapping Interventions for difference-in-difference

I am currently working on evaluating the impact of two sequential treatments, Treatment 1 and Treatment 2, on two distinct groups in our country: Group A and Group B. Treatment 1 is administered at ...
Marble's user avatar
  • 111
0 votes
1 answer
34 views

Pooled difference-in-differences with limited panel

I wish to estimate a pooled difference-in-differences specification in the following form: $y_{i,t}=\alpha_i+\theta_t + \beta \times \mathbf{1}\left(t > \bar{t}\right) \times Treatment_i + \...
Serb's user avatar
  • 13
2 votes
0 answers
38 views

Individual level covariates used in this difference-in-difference paper: a mistake?

This paper uses a differece-in-differences (DID) approach to assess the effect of adding quizzes and assignments on exam grades. The data come from 3 different sections that one of the authors taught, ...
sams's user avatar
  • 21
1 vote
0 answers
94 views

How to add interaction term into staggered DID (differentiate the effect between large company and small company)

I have a staggered DID model as follows: Here I is an indicator of whether the distance of the calendar year from the event year equals to q ( where q takes -3 to +3 and is my time window ). \delta ...
Eileen's user avatar
  • 11
2 votes
0 answers
172 views

How do I set up a staggered difference-in-differences design in R?

I have data which looks like this: ...
econdid's user avatar
  • 21
2 votes
2 answers
382 views

How to correct selection bias in an econometric analysis?

We know that selection bias occurs when the treatment and control groups are not comparable, leading to differences in the outcome that are not solely due to the treatment. How does one address the ...
funcard's user avatar
  • 43
1 vote
1 answer
65 views

Is matching combined with Diff-in-Diff a bad idea?

I remember seeing such a comment on Twitter long time ago but I see so many prominent papers doing it that I doubt it can really bad. Does somebody know more (e.g. papers) on this?
Papayapap's user avatar
  • 1,843
2 votes
1 answer
107 views

Is Difference-in-Differences still valid when treat or control is determined by subjects?

I have a question about the difference-in-differences method. I am considering using it to evaluate a policy, the UK's Help-to-Buy (H2B) equity loan scheme. The housebuilders can choose to join the ...
Yunlong Huang's user avatar
2 votes
1 answer
139 views

Diff in Diff: Why do we control for unit and time fixed effects instead of just treatment status and pre/post indicator?

In a multi-period DiD analysis, the usual specification is: $$y_{it} = \alpha_i + \theta_t + \beta D_{it} + \epsilon_{it} $$ where $D_{it}$ is the interaction between ...
Rainroad's user avatar
  • 243
2 votes
1 answer
75 views

Which covariates can I include in my fixed-effects regression?

I am doing a difference-in-difference analysis of an event that affected several states in the US. I am interested to understand the effects of this event on state-level unemployment rates. I have ...
funcard's user avatar
  • 43
1 vote
2 answers
352 views

Diff-in-diff with two control groups: compare parallel trends

Suppose in a diff-in-diff problem, I have two control groups, but just one can be used as comparison, so I want to check which of them provides a better comparison. My idea is to compare the parallel ...
Oalvinegro's user avatar
1 vote
0 answers
36 views

Short vs. long horizon event studies?

I am studying the impact of announcements by a Central Bank on a stock's returns. To measure these impacts, I employ an event study (where my event window is 10 days and my estimation window is 60 ...
angelavtc's user avatar
2 votes
0 answers
38 views

Two-way fixed effects with two treatments and interaction between both treatments

I am interested in estimating the effect of two different treatments (T1 and T2) and the interaction of the two (T1 x T2) in a two-way fixed effects event-study design. Both T1 and T2 have a "...
aeiz's user avatar
  • 21
1 vote
0 answers
43 views

Heterogeneous treatment effects with two post-treatment time and without never-treated groups

I am trying to evaluate a policy with staggered policy time (the policy was implemented in two different years), and there are no never-treated groups. The data (four-time period, highly unbalanced - ...
Chang's user avatar
  • 11
2 votes
0 answers
144 views

Meaning of non-anticipation assumption in panel context

I am moving this discussion from this comment section to a full question. Consider a binary policy $D_{it} \in \{0,1\}$ that is not randomly assigned to some units in period $t=\tau$. We have ...
Papayapap's user avatar
  • 1,843
1 vote
3 answers
159 views

Discussing Difference-in-Difference Assumption of the treatment assigment

while reviewing some of the literature on DiD and Event Study designs, I come up with a general question, since DiD is by definition a quasi-experimental approach to determining causal effects when ...
John M. Riveros's user avatar
1 vote
0 answers
34 views

Positively correlated within subject residuals in diff-in-diff shows a deflated false positive error?

My question is regarding in the difference in difference model, I am trying to see the impact of serial correlation within subjects on the treatment effect inference. In my simulation, I have two ...
Yang Song's user avatar
1 vote
1 answer
29 views

Heterogeneity of time invariant characteristic in event study model

I am trying to estimate the impact that the onset of a medical disease has on a number of outcomes, call them $O$. To do this, I am using an event study model with individual and time fixed effects... ...
salve_regina's user avatar
1 vote
2 answers
876 views

Why do we need Exogeneity of Treatment in a Diff in Diff

One of the assumptions of DiD I learnt is that the treatment must be random and unrelated to the outcome. I'm a little bit confused about why we need this assumption. If I look at the typical picture ...
Rainroad's user avatar
  • 243
4 votes
1 answer
109 views

Differences in Differences with Small Violations of Parallel Trends

I am interested (for no particular reason) in estimating a hypothetical Differences-in-Differences model with one period of treatment. However, we observe small non-linear violations of the parallel ...
wflewis's user avatar
  • 45
3 votes
0 answers
43 views

Intuition Behind Difference-in-Differences with Continuous Treatment?

It's very clear to me how a difference-in-difference model works when there is a binary treatment. If the model is $y_{i,t}=\beta_{0}+\beta_{1}P_{t}+\beta_{2}T_{i}+\beta_{3}(P_{t}*T_{t})+u_{i,t}$ ...
econogist's user avatar
5 votes
1 answer
89 views

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 ...
Frank Swanton's user avatar
1 vote
1 answer
82 views

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-...
Serb's user avatar
  • 13
1 vote
1 answer
94 views

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 ...
Anna Bokun's user avatar
2 votes
1 answer
94 views

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 ...
Galactus's user avatar
0 votes
0 answers
13 views

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 ...
macster's user avatar
1 vote
1 answer
128 views

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 ...
Nicolas L's user avatar
2 votes
1 answer
131 views

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 ...
Nils_Denter's user avatar
0 votes
3 answers
560 views

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 ...
Daycent's user avatar
  • 260
2 votes
0 answers
724 views

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 ...
Agar's user avatar
  • 21
0 votes
0 answers
33 views

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 $T_i$ ...
hrkshr's user avatar
  • 195
0 votes
0 answers
25 views

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: ...
studentp's user avatar
  • 172
1 vote
0 answers
13 views

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,...
Jan3's user avatar
  • 185
1 vote
0 answers
18 views

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 ...
Jan3's user avatar
  • 185
0 votes
1 answer
119 views

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 ...
Phil Nguyen's user avatar
  • 1,160
1 vote
0 answers
136 views

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?
abby's user avatar
  • 11
1 vote
0 answers
25 views

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 ...
Nguyen Lis's user avatar