This article discusses difference-in-differences (DID) estimators, which are commonly applied in evaluation research. In particular, the discussion focuses on (a) motivation, definition and interpretation of DID estimators, (b) conditions under which DID estimators are valid, (c) data requirements to compute DID estimators, (d) representative applications of DID estimators in the empirical economics literature, (e) extensions of DID estimators, and (f) a simple indirect test to assess the validity of these estimators.
KeywordsDifference-in-differences estimators Evaluation studies Fixed effects Minimum wages
- Angrist, J.D., and A.B.. Krueger. 1999. Empirical strategies in labor economics. In Handbook of labor economics, ed. O. Ashenfelter and D. Card, Vol. 3A. Amsterdam: North-Holland.Google Scholar
- Blundell, R., and T. MaCurdy. 1999. Labor supply: A review of alternative approaches. In Handbook of labor economics, ed. O. Ashenfelter and D. Card, Vol. 3A. Amsterdam: North-Holland.Google Scholar
- Card, D., and A.B.. Krueger. 1994. Minimum wages and employment: A case study of the fast-food industry in New Jersey and Pennsylvania. American Economic Review 84: 772–793.Google Scholar
- Meyer, B.D. 1995. Natural and quasi-experiments in economics. Journal of Business & Economic Statistics 13: 151–161.Google Scholar
- Meyer, B.D., W.K. Viscusi, and D.L. Durbin. 1995. Workers’ compensation and injury duration: Evidence from a natural experiment. American Economic Review 85: 322–340.Google Scholar