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Evaluating the Impact of Regulatory Policies on Social Welfare in Difference-in-Difference Settings

Dalia Ghanem, Désiré Kédagni, Ismael Mourifié

arXiv 7 Jun 2023 · Econometrics · 1 citations (OpenAlex)

arXiv:2306.04494 · PDF · DOI · OpenAlex · Extracted main text

Abstract

Quantifying the impact of regulatory policies on social welfare generally requires the identification of counterfactual distributions. Many of these policies (e.g. minimum wages or minimum working time) generate mass points and/or discontinuities in the outcome distribution. Existing approaches in the difference-in-difference literature cannot accommodate these discontinuities while accounting for selection on unobservables and non-stationary outcome distributions. We provide a unifying partial identification result that can account for these features. Our main identifying assumption is the stability of the dependence (copula) between the distribution of the untreated potential outcome and group membership (treatment assignment) across time. Exploiting this copula stability assumption allows us to provide an identification result that is invariant to monotonic transformations. We provide sharp bounds on the counterfactual distribution of the treatment group suitable for any outcome, whether discrete, continuous, or mixed. Our bounds collapse to the point-identification result in Athey and Imbens (2006) for continuous outcomes with strictly increasing distribution functions. We illustrate our approach and the informativeness of our bounds by analyzing the impact of an increase in the legal minimum wage using data from a recent minimum wage study (Cengiz, Dube, Lindner, and Zipperer, 2019).

Citation extraction

42
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120
in-text mentions
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distinct cited
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appendix boundary found by appendix_titled_section at “Supplementary results for Section \ref{Sec: Main-results}” · 63% 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
1Athey and Imbens (2006) Identification and Inference in Nonlinear Difference-in-Differences Models1.000164100%
2Callaway and Li (2019) Quantile treatment effects in difference in differences models with panel data1.00063100%
3Roth and Sant'Anna (2023) When is parallel trends sensitive to functional form?0.9507386%
4Cengiz, Dube, Lindner, and Zipperer (2019) The Effect of Minimum Wages on Low-Wage Jobs*0.90215673%
5Embrechts and Hofert (2013) A note on generalized inverses0.87412467%
6Nelsen (2006) An Introduction to Copulas0.8435360%
7Aaberge, Havnes, and Mogstad (2013) A theory for ranking distribution functions0.8039278%
8Mehran (1976) Linear Measures of Income Inequality0.73732100%
9Weymark (1981) Generalized gini inequality indices0.64422100%
10Wooldridge (2023) Simple approaches to nonlinear difference-in-differences with panel data0.5508225%

Showing the top 10 of 42 scored citations.

Cited by, within the corpus

arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.

Citing paperIntensityMentionsSections
1Quantile and Distribution Treatment Effects on the Treated with Possibly Non-Continuous Outcomes0.87482
2Changes-in-Changes for Ordered Choice Models with Underreporting0.58531
32cmDoes regional variation in wage levels identify the effects of a national minimum wage?0.40511
4Estimating Causal Effects of Discrete and Continuous Treatments with Binary Instruments0.40511
5Causal Interpretation of Regressions With Ranks0.40511
6Difference-in-Differences Designs: A Practitioner's Guide0.40511
7Compositional Difference-in-Differences0.40511
8Event-Study Designs for Discrete Outcomes under Transition Independence0.40511