Economics at your fingertips  

Fuzzy Differences-in-Differences

C de Chaisemartin and X D’HaultfŒuille
Authors registered in the RePEc Author Service: Xavier D'Haultfoeuille

Review of Economic Studies, 2018, vol. 85, issue 2, 999-1028

Abstract: Difference-in-differences (DID) is a method to evaluate the effect of a treatment. In its basic version, a “control group” is untreated at two dates, whereas a “treatment group” becomes fully treated at the second date. However, in many applications of the DID method, the treatment rate only increases more in the treatment group. In such fuzzy designs, a popular estimator of the treatment effect is the DID of the outcome divided by the DID of the treatment. We show that this ratio identifies a local average treatment effect only if the effect of the treatment is stable over time, and if the effect of the treatment is the same in the treatment and in the control group. We then propose two alternative estimands that do not rely on any assumption on treatment effects, and that can be used when the treatment rate does not change over time in the control group. We prove that the corresponding estimators are asymptotically normal. Finally, we use our results to reassess the returns to schooling in Indonesia.

Keywords: Differences-in-differences; Control group; Local average treatment effects; Changes-in-changes; Partial identification; Returns to education (search for similar items in EconPapers)
Date: 2018
References: Add references at CitEc
Citations: View citations in EconPapers (4) Track citations by RSS feed

Downloads: (external link) (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Fuzzy differences-in-differences (2015) Downloads
Working Paper: Fuzzy Differences-in-Differences (2015) Downloads
Working Paper: Fuzzy Differences-in-Differences Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

Review of Economic Studies is currently edited by Andrea Prat, Bruno Biais, Kjetil Storesletten and Enrique Sentana

More articles in Review of Economic Studies from Oxford University Press
Bibliographic data for series maintained by Oxford University Press ().

Page updated 2019-08-20
Handle: RePEc:oup:restud:v:85:y:2018:i:2:p:999-1028.