Synthetic Difference In Differences

By Dmitry Arkhangelsky, Susan Athey, David A. Hirshberg, Guido W. Imbens, Stefan Wager. The American Economic Review, 2018

1,169 citations recorded by the source corpus.

We present a new estimator for causal effects with panel data that builds on insights behind the widely used difference-in-differences and synthetic control methods. Relative to these methods we find, both theoretically and empirically, that this “synthetic difference-in-differences” estimator has desirable robustness properties, and that it performs well in settings where the conventional estimators are commonly used in practice. We study the asymptotic behavior of the estimator when the systematic part of the outcome model includes latent unit factors interacted with latent time factors, and we present conditions for consistency and asymptotic normality. (JEL C23, H25, H71, I18, L66)

Subfields: Statistics and Probability

View Paper: https://www.semanticscholar.org/paper/cb1442e5d29685391d8f4b63c3a9f89d560eb850

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Citations in the corpus

A Practical Guide to Counterfactual Estimators for Causal Inference with Time-Series Cross-Sectional Data (2020, methodology): “Following Arkhangelsky et al. (2019), we plot the quantiles of the distribution for standardized errors of the ATT estimates, i.”
On the Properties of the Synthetic Control Estimator with Many Periods and Many Controls (2019, methodology): “When the number of pre-treatment periods is not much larger than the number of control units, other regularization methods could be used, as considered by, for example, Doudchenko and Imbens (2016), Arkhangelsky et al. (2018), Carvalho et al. (2018), and Chernozhukov et al.”
Synthetic controls with imperfect pretreatment fit (2016, background): “…very efficient in controlling for polynomial time trends When both J and T0 diverge, Gobillon and Magnac (2016), Xu (2017), Athey et al. (2018), and Arkhangelsky et al. (2018) provided alternative estimation methods that are asymptotically valid when the number of both pretreatment periods and…”