A Practical Guide to Shift-Share Instruments

Kirill Borusyak, Peter Hull and Xavier Jaravel

Journal of Economic Perspectives, 2025, vol. 39, issue 1, 181-204

Abstract: A recent econometric literature shows two distinct paths for identification with shift-share instruments, leveraging either many exogenous shifts or exogenous shares. We present the core logic of both paths and practical takeaways via simple checklists. A variety of empirical settings illustrate key points.

JEL-codes: C26 J23 J82 R15 R23 (search for similar items in EconPapers)
Date: 2025
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Related works:
Working Paper: A practical guide to shift-share instruments (2025)
Working Paper: A practical guide to shift-share instruments (2024)
Working Paper: A Practical Guide to Shift-Share Instruments (2024)
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DOI: 10.1257/jep.20231370

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