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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27 views

diff-in-diff for binary outcome? (i.e.: Comparing proportions of two groups over two time points in paired setting)

Let's say I have students randomly split into two groups (treatment and control). Each student is given a test and they either pass or fail. They then either take a course (the students in "...
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Difference-in-Difference Multiple Independent Treatment variables

Okay this might be a very weird question. I just started reading about DiD, and was wondering if it can be applied to my problem. Unable to find any good references on this. I am considering the ...
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What's the minimum number of datapoints in order to run a diff-in-diff?

I was thinking about running a diff-in-diff with fixed effect in order to deal with a panel data experiment. The problem is that I don't know how many datapoints I need in order to the experiment be ...
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Fixed effect OLS with normalized coefficients in R

I want to estimate the following fixed effects regression: $$ Y_i = \gamma_{m}+ \lambda_b + \delta_{gb}D_{igb}+\varepsilon_i, $$ where $\gamma_m$ is municipality fixed effect, $\lambda_b$ is birth ...
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Differences in Differences - Athletes, injuries and salaries?

I am preparing the dataset to perform a DiD analysis. The dataset is panel and collects information from 2000 to 2007 on a group of athletes of a specific league. I would like to verify if the ...
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Generalized difference-in-differences where all units are treated, but at a different intensity

Is it possible to run a generalized difference-in-differences analysis where all units are treated, but at a different intensity? In my situation, a policy was introduced in 5 countries, designed to ...
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Difference-in-Difference regression setup with multiple time frames

I want to set up a difference-in-difference regression in order to interpret the effect of ESG-activities on stock performance in different time-frames during 2020 and the COVID-19 pandemic. I set up ...
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Is a placebo test the proper solution to this type of research issue?

I'd like to study the effect of the immigration quota on immigration petitions. I predict that in anticipation of the greater difficulty of being approved, potential immigrants will be less likely to ...
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Difference-in-difference method: pre-trend analysis questions

I am in the process of setting up a difference-in-differences analysis (DiD) to evaluate a particular policy. It was launched on the year 2000, and it basically is relevant in ten-year periods. One ...
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Difference in Difference using Fama-French Five Fector

I am not quite sure if I apply the Difference in Difference Method correctly and hope someone can have a look on it. I am investigating the impact of Investments in FinTech on banks stock return using ...
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DiD by using a non-time dummy variable - Methodology Issue

I do have a theoretical question about a difference-in-difference (DiD) model I constructed in Stata. Construction: Over a monthly time span of 7 years I try to analyze the impact of investment-volume ...
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Difference-in-Difference regression model for sensitivity analysis

I have 5-year sales information from a grocery store in Canada. I want to check whether an event that happened in 2017, affected the effect of the price of a product on its sales. For example, imagine ...
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Does Differences-in-Differences linear regression 'forget' the pairing between before and after data points?

Differences-in-differences regression can be used to test the impact of a treatment on a metric of interest. It works by comparing the metric before and after, both for a treatment group and for a ...
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difference-in-difference: Dynamic treatment group/timing

I want to use difference-in-difference (DiD) to estimate a treatment effect. However, my problem is a little different from the standard DiD application in that: The items in the treatment group may ...
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COVID-19: Individual level, cross-country Panel dataset. Which method to use?

I am struggling with the most appropriate method to use for my Master thesis on the impact on mental health indicators of informal caregivers before and after the start of the COVID-19 pandemic. I ...
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complex Difference-in-difference formula

I have 5-year sales information from a grocery store in Canada. I want to check whether an event that happened in 2017, affected the effect of the price of a product on its sales. For example, imagine ...
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Difference-in-difference and panel data models

I understand that according to the observations you have (two independent cross-sections in two or more time periods or the same individuals observed in two different periods), then difference-in-...
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Sample size calculation - repeated measures, two groups

We want to calculate sample size for detecting the difference between mean depression scores of two groups of patients after three months of treatment - i.e. those who received a specialized mental ...
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Difference-in-differences with inverse probability weights

How to design a model for DiD estimation where observations are weighted using inverse probability weights? I have a panel of villages and year. Treat=1 if village was treated (treatment time is ...
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Quasi-experiment analysis

I have 5-year sales information from a grocery store in Canada. I want to check the effect of an online campaign that happened in 2017 on food sales. My treatment group is people living in urban areas....
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Comparing time series data with multiple pairs of time series, or difference-in-difference with continuous treatment conditions?

My dataset contains time-series for two variables ($X$ and $Y$) from 2017 to 2020, for each of many different countries. Each country has its own time series for each variable (X_usa, X_india, Y_usa, ...
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Triple-difference Approach with Heterogeneous Treatment Effects

I would like to estimate the effects of an environmental policy on demand for green skills using individual-level data. I would like to use a triple-difference approach that embeds three margins of ...
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How do I construct a consistent DiD estimator for this specification?

I have the following specification and I am attempting to re-write this in a DiD form which I can then go on to find $\hat{\beta}_{did}$ using OLS. $n$ observations $t \in\{1,2\}$ time periods $x_{it}/...
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Analyzing a counterfactual in observational studies?

In observational studies, when randomization is not an option (everyone is treated), it is necessary to estimate a counterfactual of what would have happened in the absence of treatment. Once you ...
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Is difference-in-difference a valid method to analyze A/B test results?

Is a difference-in-difference (DiD) analysis an acceptable method to analyze A/B test results? I know that DiD is more suitable for observational studies (when randomization is not possible), but it ...
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How to match regions in difference in difference analysis

I've had an idea for a project to work on over Winter break. It involves a difference in difference analysis of two similar-sized cities on different sides of a state border. How do I confirm that the ...
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Bacon decomposition

I have a panel dataset in which treatment happens over time. I am using a two-way fixed effects model to estimate the effect of a dummy treatment variable. I am trying to check whether my DID ...
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237 views

Test for parallel trends in difference-in-difference models with staggered treatment

Following a comment from a previous thread (below), I would appreciate if you may advise me on how to test for parallel trends in Stata for a DiD model with multiple groups and staggered treatment (i....
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Identifying assumptions of Difference-in-Difference versus Fixed Effects models

I am reading the seventh edition of Introductory Econometrics: A Modern Approach by Jeffrey Wooldridge and I am a bit confused on the different identifying assumptions for difference-in-difference ...
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A difference in difference experiment with multiple interventions

Say you have a control group and an experimental group and you have verified the parallel trends assumption for them. Now say that at the time of intervention, the control group gets 9 separate ...
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Why is ANCOVA not appropriate for modelling post-intervention outcome, controlling for baseline

I was trying to understand the different use-cases for differences-in-differences models vs. ANCOVA (post-period = pre-period + experiment_group), for observational data. I came across the below ...
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How to write a triple differences model with fixed effects?

I have a bunch of states $i$ Some are treatment states and others are control states, where $T_i$ is 1 if treatment I believe the treatment effect differs for big states, where $B_i$ indicates if a ...
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Difference in Differences Model Specification with Year-Quarter Effects (treatment non-binary)

I am currently creating a difference-in-differences (DiD) model and have a few questions left: I am examining the effect of Airbnb-listings on the hospitality industry in major German cities. I have ...
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Difference in difference for GLM's/MLE

I would like to run the regression in the classical difference-in-difference framework, i.e.: $Y_{i,t}$ = $\psi + \beta\text{Post}\times\text{Treat} + \delta\text{Post} +\gamma\text{Treat} + \epsilon_{...
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DiD with time invariant and time variant treatment?

I am currently working on a project that seeks to study the impact of the subprime crisis on family firms and non-family firms. In this, I have imagined to use a DiD estimator to account for ...
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Difference in difference - everyone treated and measure different response?

I was wondering if there is a model or study where everyone receives the treatment and measures how post-treatment outcome is different. For instance, in a state, minimum wage rose and estimate ...
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Is there any precedence for using time for both differences in difference-in-difference analysis?

The textbook example of a difference-in-difference regression uses time at the first difference (pre- vs. post-intervention) and geographical area as the second difference (location where intervention ...
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Difference in difference- what variation is being used?

This I assume is an obvious question, but I usually hear it said that with difference in difference estimators, you don't need to worry about level differences between groups. I am wondering if this ...
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Control group within the country for national policy

I have a question about control group selection. I want to evaluate a private education suppression policy. The policy is that 70% of questions of a "national" university entrance test is ...
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Is this an appropriate use of difference in differences?

Here is the situation: There was an intervention $T$. I am interested in how this intervention changed the minutes spent using a computer in 5 counties: $C_{a,t}, C_{b,t}, C_{c,t}, C_{d,t}, C_{e,t}$ ...
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Difference in differences for multiple data with different intervention times?

I am trying to examine the effects of COVID-19 related lockdowns and was told by a friend that D-in-D would be a good way to handle this. I have looked at some tutorials/youtube videos but everything ...
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Difference in difference with similar units over 2 periods of time

I have ESG (Environmental, Social & Governance) scores for 20 companies over a period of 10 years. In the fifth year a policy was introduced and I want to estimate the impact/effect of the policy ...
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Panel data 'binary' treatment with multiple 'odd' start and end times

I am investigating the impact of a county-level policy on crime outcomes. I am using a two-way fixed effects estimator. My exposure (i.e., treatment) is a static binary variable. The binary treatment ...
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163 views

treatment effect on unbalanced panel data

I have an unbalanced dataset that contains movie sales data along with some of the characteristics of the movies for several years. One treatment (event) happened in the society in a specific year in ...
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Should the treatment effect coefficient in a difference-in-difference model be consistent with graph trend?

I am running a difference-in-difference regression and the coefficient of the interaction term (treat*post) is negative, so I concluded that the effect of the treatment was negative on the outcome ...
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Calculating standard errors by hand for difference in differences

If I am running a difference in difference as the following: $y_{i,t}=\beta Treat_i x Post_t + Post_t +Treat_i + \epsilon_{i,t}$ Where i can index say, state, and t time. If I wanted to calculate the ...
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Cluster issues for treatment effects analysis

I'm doing a Difference in Differences exercises on 32 regions within a country to test for the effect of a policy intervention. However, only 1 of those regions has been subject to the intervention; ...
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Why diff-in-diff over regression with control variable for measuring treatment intervention in time series?

Let's suppose we have a time series data set, with an intervention period for the treatment where the mean of the independent variable increases by 10. The goal is to measure the effect of the ...
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Log-level or growth as dependent variable in difference-in-difference model

I want to analyse the effect of a shock in pollution on rainfall and run into a little discussion with my coauthor. The shock does not affect all regions, but occurs at the same time. We decided to ...

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