IDEAS home Printed from https://ideas.repec.org/p/arx/papers/2012.08988.html
   My bibliography  Save this paper

Exact Trend Control in Estimating Treatment Effects Using Panel Data with Heterogenous Trends

Author

Listed:
  • Chirok Han

Abstract

For a panel model considered by Abadie et al. (2010), the counterfactual outcomes constructed by Abadie et al., Hsiao et al. (2012), and Doudchenko and Imbens (2017) may all be confounded by uncontrolled heterogenous trends. Based on exact-matching on the trend predictors, I propose new methods of estimating the model-specific treatment effects, which are free from heterogenous trends. When applied to Abadie et al.'s (2010) model and data, the new estimators suggest considerably smaller effects of California's tobacco control program.

Suggested Citation

  • Chirok Han, 2020. "Exact Trend Control in Estimating Treatment Effects Using Panel Data with Heterogenous Trends," Papers 2012.08988, arXiv.org.
    • Handle: RePEc:arx:papers:2012.08988
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/2012.08988
    File Function: Latest version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Alberto Abadie & Javier Gardeazabal, 2003. "The Economic Costs of Conflict: A Case Study of the Basque Country," American Economic Review, American Economic Association, vol. 93(1), pages 113-132, March.
    2. Laurent Gobillon & Thierry Magnac, 2016. "Regional Policy Evaluation: Interactive Fixed Effects and Synthetic Controls," The Review of Economics and Statistics, MIT Press, vol. 98(3), pages 535-551, July.
    3. Li, Kathleen T. & Bell, David R., 2017. "Estimation of average treatment effects with panel data: Asymptotic theory and implementation," Journal of Econometrics, Elsevier, vol. 197(1), pages 65-75.
    4. Abadie, Alberto & Diamond, Alexis & Hainmueller, Jens, 2010. "Synthetic Control Methods for Comparative Case Studies: Estimating the Effect of California’s Tobacco Control Program," Journal of the American Statistical Association, American Statistical Association, vol. 105(490), pages 493-505.
    5. Cheng Hsiao & H. Steve Ching & Shui Ki Wan, 2012. "A Panel Data Approach For Program Evaluation: Measuring The Benefits Of Political And Economic Integration Of Hong Kong With Mainland China," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 27(5), pages 705-740, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Carvalho, Carlos & Masini, Ricardo & Medeiros, Marcelo C., 2018. "ArCo: An artificial counterfactual approach for high-dimensional panel time-series data," Journal of Econometrics, Elsevier, vol. 207(2), pages 352-380.
    2. Bruno Ferman & Cristine Pinto, 2021. "Synthetic controls with imperfect pretreatment fit," Quantitative Economics, Econometric Society, vol. 12(4), pages 1197-1221, November.
    3. Victor Chernozhukov & Kaspar Wüthrich & Yinchu Zhu, 2019. "Inference on average treatment effects in aggregate panel data settings," CeMMAP working papers CWP32/19, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
    4. Victor Chernozhukov & Kaspar Wuthrich & Yinchu Zhu, 2018. "Debiasing and $t$-tests for synthetic control inference on average causal effects," Papers 1812.10820, arXiv.org, revised May 2025.
    5. Li, Xingyu & Shen, Yan & Zhou, Qiankun, 2024. "Confidence intervals of treatment effects in panel data models with interactive fixed effects," Journal of Econometrics, Elsevier, vol. 240(1).
    6. Jianqing Fan & Ricardo Masini & Marcelo C. Medeiros, 2022. "Do We Exploit all Information for Counterfactual Analysis? Benefits of Factor Models and Idiosyncratic Correction," Journal of the American Statistical Association, Taylor & Francis Journals, vol. 117(538), pages 574-590, April.
    7. Michael Funke & Kadri Männasoo & Helery Tasane, 2023. "Regional Economic Impacts of the Øresund Cross-Border Fixed Link: Cui Bono?," CESifo Working Paper Series 10557, CESifo.
    8. Xiong, Ruoxuan & Pelger, Markus, 2023. "Large dimensional latent factor modeling with missing observations and applications to causal inference," Journal of Econometrics, Elsevier, vol. 233(1), pages 271-301.
    9. Du, Zaichao & Pei, Pei, 2021. "A simple and robust counterfactual impact evaluation," Economics Letters, Elsevier, vol. 207(C).
    10. Dmitry Arkhangelsky & Guido Imbens, 2023. "Causal Models for Longitudinal and Panel Data: A Survey," Papers 2311.15458, arXiv.org, revised Jun 2024.
    11. Pengyue Wu & Wenjing Xu & Jing Ma, 2024. "Policy Evolution and Effect Evaluation of Zhejiang Manufacturing Industry Based on Text Data," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 2895-2932, March.
    12. Aleksandar Kešeljević & Rok Spruk, 2024. "Estimating the effects of Syrian civil war," Empirical Economics, Springer, vol. 66(2), pages 671-703, February.
    13. Luya Wang & Jeffrey S. Racine & Qiaoyu Wang, 2025. "Bootstrap inference on a factor model based average treatment effects estimator," Econometric Reviews, Taylor & Francis Journals, vol. 44(1), pages 80-89, January.
    14. Yi‐Ting Chen, 2020. "A distributional synthetic control method for policy evaluation," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 35(5), pages 505-525, August.
    15. Yang, Bingyan & Liu, Ruiming & Liu, Chuanbin & Shi, Yang, 2025. "Publish or perish: Up-or-out rules and research performance of universities," China Economic Review, Elsevier, vol. 89(C).
    16. Shi, Zhentao & Huang, Jingyi, 2023. "Forward-selected panel data approach for program evaluation," Journal of Econometrics, Elsevier, vol. 234(2), pages 512-535.
    17. Shih-Chih Chen & Jianing Hou & De Xiao, 2018. "“One Belt, One Road” Initiative to Stimulate Trade in China: A Counter-Factual Analysis," Sustainability, MDPI, vol. 10(9), pages 1-13, September.
    18. Anderson, Heather M. & Gao, Jiti & Turnip, Guido & Vahid, Farshid & Wei, Wei, 2023. "Estimating the effect of an EU-ETS type scheme in Australia using a synthetic treatment approach," Energy Economics, Elsevier, vol. 125(C).
    19. Callaway, Brantly & Karami, Sonia, 2023. "Treatment effects in interactive fixed effects models with a small number of time periods," Journal of Econometrics, Elsevier, vol. 233(1), pages 184-208.
    20. Hongjun Li & Zheng Li & Cheng Hsiao, 2023. "Assessing the impacts of pandemic and the increase in minimum down payment rate on Shanghai housing prices," Empirical Economics, Springer, vol. 64(6), pages 2661-2682, June.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:arx:papers:2012.08988. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.