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Cohort-Anchored HonestDiD

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  • Ziyi Liu

Abstract

HonestDiD sensitivity analysis (Rambachan and Roth, 2023) is usually applied to event-study coefficients aggregated across cohorts. Under staggered adoption, the treated cohorts contributing to these coefficients change with event time, as do their control groups with estimators that use not-yet-treated units. Therefore, the restriction on the aggregated coefficients and the corresponding inference does not have a clear interpretation. This paper proposes to do the HonestDiD sensitivity analysis on a cohort basis. The restriction is placed on each cohort's block bias, which captures its violation of parallel trends relative to the units untreated when it first adopts treatment. The restriction on the block bias maps to the restriction on the estimation bias through an invertible linear decomposition. In simulations, the proposed cohort inference keeps nominal coverage when parallel trend violations differ across cohorts, where the inference based on aggregated coefficients can fail. Applying the method to Callaway and Sant'Anna (2021) and Bailey and Goodman-Bacon (2015), I highlight the trade-off between interpretable imposed restrictions and the precision demands of cohort inference.

Suggested Citation

  • Ziyi Liu, 2025. "Cohort-Anchored HonestDiD," Papers 2509.01829, arXiv.org, revised Oct 2026.
  • Handle: RePEc:arx:papers:2509.01829
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    References listed on IDEAS

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    1. Ashesh Rambachan & Jonathan Roth, 2023. "A More Credible Approach to Parallel Trends," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 90(5), pages 2555-2591.
    2. Sun, Liyang & Abraham, Sarah, 2021. "Estimating dynamic treatment effects in event studies with heterogeneous treatment effects," Journal of Econometrics, Elsevier, vol. 225(2), pages 175-199.
    3. Aguilar-Loyo, Jhordano, 2025. "A comparative analysis of two-way fixed effects estimators in staggered treatment designs," Journal of Econometrics, Elsevier, vol. 251(C).
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    Cited by:

    1. Jonathan Roth, 2026. "Interpreting event-studies from recent difference-in-differences methods," The Japanese Economic Review, Springer, vol. 77(2), pages 275-288, April.

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