Impact evaluation using Difference-in-Differences

Authors

  • Anders Fredriksson University of São Paulo, School of Economics, Business and Accounting
  • Gustavo Magalhães de Oliveira University of São Paulo, School of Economics, Business and Accounting

DOI:

https://doi.org/10.1108/RAUSP-05-2019-0112

Keywords:

Impact evaluation, Policy evaluation, Management, Causal effects, Difference-in-Differences, Parallel trends assumption

Abstract

Purpose – This paper aims to present the Difference-in-Differences (DiD) method in an accessible language to a broad research audience from a variety of management-related fields. Design/methodology/approach – The paper describes the DiD method, starting with an intuitive explanation, goes through the main assumptions and the regression specification and covers the use of several robustness methods. Recurrent examples from the literature are used to illustrate the different concepts. Findings – By providing an overview of the method, the authors cover the main issues involved when conducting DiD studies, including the fundamentals as well as some recent developments. Originality/value – The paper can hopefully be of value to a broad range of management scholars interested in applying impact evaluation methods.

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Published

2019-12-20

Issue

Section

Research Paper