Direct and Indirect Effects Based on Difference-in-Differences with an Application to Political Preferences Following the Vietnam Draft Lottery

Eva Deuchert, Martin Huber and Mark Schelker

No 6000, CESifo Working Paper Series from CESifo

Abstract: We propose a difference-in-differences approach for disentangling a total treatment effect within specific subpopulations into a direct effect as well as an indirect effect operating through a binary mediating variable. Random treatment assignment along with specific common trend and effect homogeneity assumptions identify the direct effects on the always and never takers, whose mediator is not affected by the treatment, as well as the direct and indirect effects on the compliers, whose mediator reacts to the treatment. In our empirical application we analyse the impact of the Vietnam draft lottery on political preferences. The results suggest that a high draft risk due to the draft lottery outcome leads to an increase in mild preferences for the Republican Party, but has no effect on strong preferences for either party or on specific political attitudes. The increase in Republican support is mostly driven by the direct effect not operating through the mediator that is military service.

Keywords: treatment effects; causal mechanisms; direct and indirect effects; Vietnam War lottery; political preferences (search for similar items in EconPapers)
JEL-codes: C21 C22 D70 D72 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Direct and Indirect Effects Based on Difference-in-Differences With an Application to Political Preferences Following the Vietnam Draft Lottery (2019)
Working Paper: Direct and indirect effects based on difference-in-differences with an application to political preferences following the Vietnam draft lottery (2017)
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