Questions tagged [difference-in-difference]

Often abbreviated DID or DD, this is a technique for inferring causality from observational data. It involves comparing measurements before and after a treatment occurs (hence, the growth rate) in both a group that received the treatment, and an otherwise comparable group that did not.

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Difference in difference with delayed effect

Imagine I have a policy intervention where I expect a one-period lag between when the intervention happens and when the intervention's effect shows up in my outcome variable. Something slow to adjust, ...
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Difference in differences - Is it OK to use the same variable to define the treat group and inside the regression?

I'm running diff and diff regression using the results of a repeated cross-sectional survey. I'm trying to test the effects of raise in min wage. I didn't have the actual salaries of the people who ...
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Looking for feedback on matching and difference-in-differences analysis

I am looking to set up my data and I have a question about the matched-pairs approach. I have plans for how to setup my data and am hoping for feedback as to whether it is a good way to go. ...
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Is this a valid differences-in-differences-in-differences design?

I'm interesting in exploiting policy changes in benefits enjoyed by individuals to estimate the effect of the benefit on a certain outcome variable. The policy changes come in the following form: at ...
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Staggered Diff-in-Diff: multiple treatments equation

I wonder if you can help me to figure out how to rewrite basic difference-in-difference equation (pictured) so that it takes into account the fact that treatment has occurred at different times for ...
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Difference in Difference multiple Time Treatment : R or Stata

I have panel data to which I fit a Difference-in-Difference model. Specifically, I regress Bilateral Investment Treaties (BIT) on Bilateral Foreign Direct Investment (FDI). BIT is a dummy variable ...
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Differences in differences, fixed effects and standard errors

I have a question on estimating a difference in differences model using Stata. As I understand this, also from other questions, when there are no covariates, estimating the diff in diff using a ...
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Does DiD work when not all individuals have pre-treatment observations?

I would like to make causal statements on the effect of a treatment on a group of individuals. I have panel data on these individuals but the treatments do not occur at the same time in their life. ...
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Why post main effect being subsumed into the time fixed effects

In the DD equation, I have Treat indicator and Post indicator. The model also includes state fixed effects and year fixed effects. Is it necessary to omit Post variable (thus only Treat and Treat*Post)...
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Difference-in-difference regression and random-effects Tobit model

I have a question about the difference-in-differences (DID) model. In general, we use random-effects Tobit model to fit the censored panel data (in Stata command: xttobit...). But to my knowledge, ...
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Difference in Difference model: How to find the control group [closed]

I am conducting research on the effect on a regulation applied in Hong Kong. I am analyzing the impact of the exclusion of sales commission of investment products which caused a conflict of interests ...
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difference-in-differences with multiple time periods - parallel trend assumption

I am performing this resgression: $$ y_{it} = \beta_{0} + \beta_{1}\text{Treat}_{i} + \sum_{j \neq k} \lambda_{j} \text{Year}_{t=j} + \sum_{j \neq k} \delta_j \left( \text{Treat}_i \cdot \text{Year}_{...
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How does the parallel trends assumption operate when there are multiple interventions?

My question relates to how the parallel trends assumption operates in a difference-in-difference (DID) analysis when there are two interventions of interest (in the plot, T1 and T2). T1 and T2 are ...
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How to interpret triple interaction in difference-in-differences

Suppose that I have a dummy $treated_s$, which indicates whether a state $s$ was treated at any point in time, and a dummy $time_t$, which indicates whether year $t$ is after the treatment year. The ...
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Non-traditional Difference in Difference: first voluntary treatment then compulsory

I have the following scenario. I have two groups. With the first one nothing happens during the whole time span. However, for the second one situation changes. First, Reform 1 happens and allows ...
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What would a suitable justification be to use 'log(exports)' as a dependent variable instead of solely 'exports'? [duplicate]

I am doing a diff-in-diff analysis, looking at whether a regulation had an impact on British pollution-intensive exports. Initially I used 'total exports of pollution-intensive goods' as my dependent ...
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difference-in-differences - multiple time periods analyzing results

I am tring to perform this resgression: $$ y_{it} = \beta_{0} + \beta_{1}\text{Treat}_{i} + \sum_{j \neq k} \lambda_{j} \text{Year}_{t=j} + \sum_{j \neq k} \delta_j \left( \text{Treat}_i \cdot \text{...
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Diff in Diff and FE

I have repeated cross sectional data from the 2003, 2008 and 2014 waves of women aged 15-49. Here is the set up: I am using a difference-in-difference specification, where my post variable equals 1 ...
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How to apply Difference-in-Differences analysis in R on binomially distributed data?

I have a situation very similar to this one, but I have some extra questions/clarifications I need, and I could not comment under that thread (I don't have enough reputation :( ). Due to technical ...
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How to give a percentage change interpretation for diff-in-diff coefficient of interest?

I'm doing a diff-in-diff to see whether a chosen regulation has an effect on goods exports. I got my coefficient of interest result as being -53,157.68, which would mean that this regulation caused a ...
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Interpreting significance in difference in difference results

I have a panel dataset of two groups X1 (control) and X2 (treatment), and my metric of interest Y (for both control and treatment). I have a dummy variable indicating what group they belong to, and a ...
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Combining two studies of different types

Initial Setup In a specific experimental design, there are two treatments and two study sites. Suppose we have the model \begin{align*} Y_{ijk} = \beta^\intercal X_{ijk} + \mu_i + \nu_j + \eta_{ij} + ...
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How many observations are preferred for a difference-in-difference analysis?

I'm doing a difference-in-difference analysis using export data split by four SITC codes. I have 442 observations in total and my dependent variable is total exports for the four codes which has 58 ...
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Measuring the causal impact of a policy that is not binding

This may be a little tricky because it's difficult to explain but bear with me. Assume a new policy implemented in 2015 which is a new requirement for firms, let's say for instance that the ...
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Interpretation of interaction coefficients in difference-in-difference

There are two time periods: 2010 and 2015 There are two groups: treatment and control group The equation looks like this: $$ y= a + b_1\text{treat}+ b_2\text{post} + b_3\text{treat}\cdot\text{...
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Difference in difference with time-invariant interaction

I am trying to find whether it can be still considered a triple difference-in-difference model when we interact the DD estimate with a third variable (moderator), as discussed here: Difference in ...
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Difference in Differences with Multiple Time Periods and Multiple Treatment Periods

I'm working on a panel data difference in differences model where each unit (country) is observed every year. In any year, a country can be engaged in a war (treatment), a militarized interstate ...
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What are the relative advantages and disadvantages of using Diff-in-diff instead of a normal panel data/ cross-sectional analysis?

I am writing a report on whether environmental regulation affects trade by looking at a specific EU policy on emissions. I am planning on using the difference-in-differences method ans from reading ...
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diff in diff using time dummies instead of post

$$ y_{it} = \beta0\ + \beta1\cdot treat\ + beta2\cdot post+\sum_{j\neq k} \delta_j \left( \text{treat}_i \cdot year(t=j) \right) + X'\gamma + \epsilon_t $$ time periods t=1,2,...,k,...,T periods ...
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Difference-in-difference using tobit regression with mediation (controlling for fixed effects)

I want to conduct a mediation analysis in a difference-in-difference setting. I want to determine which element of the policy was effective. My difference-in-difference is based on a matched sample ...
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difference in difference fixed effect vs clustered standard error

I am trying to run a difference-in-difference regression. I have one country in the treatment group and two countries in the control group. I believe there is a need to account for fixed effects to ...
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What does it mean if a fixed effects regression gives the same coefficients as one that has no fixed effects?

I am doing a difference-in-differences analysis, looking at whether environmental regulation has an effect on exports. I added fixed effects for country and time, but on STATA it gave me the same ...
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fixed effects in differences in differences

In a differences in differences it is quite typical to have $y_{ist} = \lambda_t + \alpha_s + \beta_1D_{s,t} + \epsilon_{ist}$ where $\lambda_t$ is a time fixed effect and $\alpha_s$ is a group ...
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How to interpret event study/diff in diff specification with continuous treatment?

Say you are running a diff in diff, where some treatment occured nationally at time t=0, and you use some continuous measure of pre-existing characteristics (or some continuous instrument) to capture '...
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Do control variables need to be added for the following parallel trends assumption test for diff-in-diff?

I completed the following test for parallel trends Difference in Difference method: how to test for assumption of common trend between treatment and control group? However, I am unsure as to whether ...
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Panel data diff-in-diff and the pattern of the binary treatment indicator

I am self-studying the book Introductory Econometrics: A Modern Approach by Jeffrey M. Wooldridge and stumped upon a question while reading the chapter on Advance Panel Data Methods (Ch. 14). Normally,...
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How to apply the propensity score corresponding to data from several years (panel data)?

My research topic is: The impact of a scholarship on the average salary of graduate students. I have a panel dataset for the years 2010 to 2016. My treatment group is students who received a ...
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What is the difference between the strict exogeneity assumption in OLS and the strict exogeneity assumption in DiD?

I don't really understand the difference between the strict exogeneity assumption in OLS and the strict exogeneity assumption in DiD (difference-in-differences). If they are the same, then what is the ...
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Probit function, Difference in difference approach, Standard errors in R

I'm a novice R user. I'm dealing with some CPS data to evaluate how labor force participation of single female with children changed in response to some policy implementation. The below is my ...
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Interpretation of interaction term in negative binomial Difference-in-Differences regression

I have a question regarding how to interpret an interaction term in a negative binomial Difference-in-Differences (DiD) regression. I use the negative binomial as my dependent variable (crimes) is ...
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What to do when difference-in-differences affects covariates

Consider the model $y_{it} = \alpha_i + \beta_{it}did_{it} + \gamma_{it} + \phi_i + \zeta_t + \varepsilon_{it}$ for group $i$ and year $t$. $\phi_i$ refers to group fixed effects and $\zeta_t$ to ...
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CALCULATING DIFFERENCE between percentages derived from two different numbers (help)

I recently came across a graph comparing education levels between foreign born immigrants and US born citizens that was divided into four categories. Less than highschool, Highschool graduate, Some ...
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Panel data question

I am using a difference-in-difference strategy using panel data. I define my treatment group as mothers whose youngest child is less than 1 years old and my control group as mothers whose youngest ...
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Treatment group is omitted because of collinearity

I am using a difference-in-difference strategy with fixed effects -xtreg...,fe robust-. I am using as my treatment group mothers whose youngest child is younger than one. I am investigating a few ...
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Confused about results from placebo diff-in-diff

I construct the simple placebo sample I then construct a dummy for whether the year is after the placebo treatment year, 2012. I interact this dummy with the treatment dummy to construct the diff-in-...
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Difference in Differences model: minimum wage impact on employment, is the method correct?

Difference-in-Differences (DiD) model will be applied to the Lithuania‘s case in order to evaluate the effect of policy change of the increasing minimum wage on employment. The treatment group in the ...
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The difference between DID and fixed effect model

It is said that the DID (difference-in-difference) is a special case of the fixed-effect model. However, in my understanding, they solve different problems: In the case of DID, there is an unobserved ...
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Where is variation coming from regressions with continuous variables and state and time fixed effects?

Say first I am regressing $Y_{st} = \beta X_{st} + U_s + \epsilon_{st}$ where $X$ is continuous varying at the state time, $U$ are state fixed effects, and $\epsilon$ is the error term. If I ...
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How can I update a disease prediction model with new treatment group data while maintaining the original causal relationships?

Context: I have a prediction model which predicts the probability of getting a disease. This prediction model has been created based on data of patients who did not get any form of treatment. I use ...
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Finding Model/Technique to find effect of alcohol prohibtion on health outcomes

As a study project, using Stata, I'm trying to figure out the effect alcohol prohibition in Kerala state had on health outcomes of Keralans. I did some preliminary descriptive statistics with Stata ...

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