ECON 151 Lecture Notes - Lecture 11: Econometric Model, 1Time Airline
11 Nov 2020
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Document Summary
Difference in differences: a valid approach to isolate causality. Did compares trend: the progression in a control group (non-treated) against the progression in the treatment group; In our example, we measure before and after on a group of children receiving s and on another control group; by adding and subtracting e (y 0 i s=1 |s = 1) Did estimator capture the true causal effect if: Y 0 i s=0 |s = 1) = e(y 0 i s=1. Y 0 i s=0 |s = 0) i s=1. Common trend assumption : the trend in the treatment group would have been the same than the one in the control group, in the absence of the treatment. Y = 0+ 1time+ 2s time+ 2s+ using a long format dataset . With time taking 0 at time 0 and 1 at time 1, s the program and. S*time the interaction between the program and the time.
