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Two-way fixed effects estimators with heterogeneous treatment effects

Clément de Chaisemartin, Xavier D'Haultfœuille

arXiv 21 Mar 2018 · Econometrics · publishedAmerican Economic Review (2020) · 4,664 citations (OpenAlex)

arXiv:1803.08807 · PDF · DOI · OpenAlex · Extracted main text

Abstract

Linear regressions with period and group fixed effects are widely used to estimate treatment effects. We show that they estimate weighted sums of the average treatment effects (ATE) in each group and period, with weights that may be negative. Due to the negative weights, the linear regression coefficient may for instance be negative while all the ATEs are positive. We propose another estimator that solves this issue. In the two applications we revisit, it is significantly different from the linear regression estimator.

Citation extraction

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appendix boundary found by appendix_command · 73% of the source is main text. Read the extracted text to check this.

Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
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3Borusyak \ Jaravel (2017) Revisiting event study designs0.69351100%
4de Chaisemartin \ D'Haultfuille (2018) `Fuzzy differences-in-differences', The Review of Economic Studies 85(2), 999–10280.64441100%
5Goodman-Bacon (2018) Difference-in-differences with variation in treatment timing0.58531100%
6Imai \ Kim (2018) `On the use of two-way fixed effects regression models for causal inference with panel data'0.58531100%
7Abraham \ Sun (2018) Estimating dynamic treatment effects in event studies with heterogeneous treatment effects0.51121100%
8Athey \ Imbens (2018) Design-based analysis in difference-in-differences settings with staggered adoption, Technical report, National Bureau of Econom…0.51121100%
9Callaway \ Sant'Anna (2018) Difference-in-differences with multiple time periods and an application on the minimum wage and employment0.51121100%
10Freeman (1984) `Longitudinal analyses of the effects of trade unions', Journal of labor Economics 2(1), 1–260.51121100%

Showing the top 10 of 22 scored citations.

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1Instrumented Difference-in-Differences with Heterogeneous Treatment Effects0.92843
2Stacked Triple Differences0.87464
3Two-stage differences in differences0.87452
4Robust Inference for Weighted Estimands0.81142
5Triple Difference Designs with Heterogeneous Treatment Effects0.73732
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72cmDoes regional variation in wage levels identify the effects of a national minimum wage?0.64422
8Interpreting Event-Studies from Recent Difference-in-Differences Methods0.64422
9Heterogeneous Responses to Continuous Treatments: A Cluster-Based Causal Framework0.64422
10Synthetic Control Inference for Staggered Adoption0.51121