Double/debiased machine learning for difference-in-differences models

Neng-Chieh Chang

The Econometrics Journal, 2020, vol. 23, issue 2, 177-191

Abstract: SummaryThis paper provides an orthogonal extension of the semiparametric difference-in-differences estimator proposed in earlier literature. The proposed estimator enjoys the so-called Neyman orthogonality (Chernozhukov et al., 2018), and thus it allows researchers to flexibly use a rich set of machine learning methods in the first-step estimation. It is particularly useful when researchers confront a high-dimensional data set in which the number of potential control variables is larger than the sample size and the conventional nonparametric estimation methods, such as kernel and sieve estimators, do not apply. I apply this orthogonal difference-in-differences estimator to evaluate the effect of tariff reduction on corruption. The empirical results show that tariff reduction decreases corruption in large magnitude.

Keywords: Difference-in-differences; high-dimensional data; causal inference; machine learning (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (24)

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Persistent link: https://EconPapers.repec.org/RePEc:oup:emjrnl:v:23:y:2020:i:2:p:177-191.

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