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This paper introduces an overidentification test of two alternative assumptions to identify the average treatment effect on the treated in a two-period panel data setting: unconfoundedness and common trends. Under the unconfoundedness…
The difference-in-differences (DID) research design is a key identification strategy which allows researchers to estimate causal effects under the parallel trends assumption. While the parallel trends assumption is counterfactual and cannot…
Violations of the parallel trends assumption pose significant challenges for causal inference in difference-in-differences (DiD) studies, especially in policy evaluations where pre-treatment dynamics and external shocks may bias estimates.…
A key assumption of the differences-in-differences designs is that the average evolution of untreated potential outcomes is the same across different treatment cohorts: a parallel trends assumption. In this paper, we relax the parallel…
Difference-in-differences is a common method for estimating treatment effects, and the parallel trends condition is its main identifying assumption: the trend in mean untreated outcomes is independent of the observed treatment status. In…
Difference-in-differences is a popular method for observational health policy evaluation. It relies on a causal assumption that in the absence of intervention, treatment groups' outcomes would have evolved in parallel to those of comparison…
This paper illustrates the use of entropy balancing in difference-in-differences analyses when pre-intervention outcome trends suggest a possible violation of the parallel trends assumption. We describe a set of assumptions under which…
Difference-in-differences (DID) is popular because it can allow for unmeasured confounding when the key assumption of parallel trends holds. However, there exists little guidance on how to decide a priori whether this assumption is…
The plausibility of the ``parallel trends assumption'' in Difference-in-Differences estimation is usually assessed by a test of the null hypothesis that the difference between the average outcomes of both groups is constant over time before…
We address an ambiguity in identification strategies using difference-in-differences, which are widely applied in empirical research, particularly in economics. The assumption commonly referred to as the "no-anticipation assumption" states…
Difference-in-differences (DiD) is one of the most popular approaches for empirical research in economics, political science, and beyond. Identification in these models is based on the conditional parallel trends assumption: In the absence…
Difference-in-differences is one of the most used identification strategies in empirical work in economics. This chapter reviews a number of important, recent developments related to difference-in-differences. First, this chapter reviews…
Difference-in-differences is a widely-used evaluation strategy that draws causal inference from observational panel data. Its causal identification relies on the assumption of parallel trends, which is scale dependent and may be…
This paper analyzes difference-in-differences designs with a continuous treatment. We show that treatment-on-the-treated-type parameters are identified under a parallel trends assumption analogous to the binary treatment case. However,…
Difference-in-differences (DiD) is the most popular observational causal inference method in health policy, employed to evaluate the real-world impact of policies and programs. To estimate treatment effects, DiD relies on the "parallel…
Consider a general setting in which data on an outcome is collected in two `groups' at two time periods, with certain group-periods deemed `treated' and others `untreated'. A special case is the canonical Difference-in-Differences (DiD)…
Under what circumstances is it a threat to the parallel trends assumption required for Difference in Differences (DiD) studies if treatment decisions are based on past values of the outcome? We explore via simulation studies whether…
Suppose it is of interest to characterize effect heterogeneity of an intervention across levels of a baseline covariate using only pre- and post- intervention outcome measurements from those who received the intervention, i.e. with no…
Difference-in-differences is based on a parallel trends assumption, which states that changes over time in average potential outcomes are independent of treatment assignment, possibly conditional on covariates. With time-varying treatments,…
This paper proposes a novel approach for estimating treatment effects in panel data settings, addressing key limitations of the standard difference-in-differences (DID) approach. The standard approach relies on the parallel trends…