Hi all,
I have two probably simple questions that I can't figure out, as I'm fairly new to DD models. I'm computing a relatively simple difference-in-differences regression model, where I have two control provinces and one treatment province. I have 22 years of data (7 pre, 3 during, and 12 post); it is uneven due to the policy interventions before mine that I am studying.
1) When I am including two control groups, do I simply code them as below (where 0 = both of the control provinces and 1 = the treatment province) – or do I have to separate them somehow? If it is the former case, how would I interpret the results of the control group, then? Obviously I am looking mainly at the interaction variable but I'm confused as to what "province" would tell me. Before doing this, I simply ran two different DD models (one with each different province as the control).
2) I would like to measure three time periods instead of two, as the policy in question was 'rolled out' over three years. Would it make sense to add in those 3 years in the regression, like the code example below? Or should I interact this time period with province as well (dur##province)?
Thank you in advance!
I have two probably simple questions that I can't figure out, as I'm fairly new to DD models. I'm computing a relatively simple difference-in-differences regression model, where I have two control provinces and one treatment province. I have 22 years of data (7 pre, 3 during, and 12 post); it is uneven due to the policy interventions before mine that I am studying.
1) When I am including two control groups, do I simply code them as below (where 0 = both of the control provinces and 1 = the treatment province) – or do I have to separate them somehow? If it is the former case, how would I interpret the results of the control group, then? Obviously I am looking mainly at the interaction variable but I'm confused as to what "province" would tell me. Before doing this, I simply ran two different DD models (one with each different province as the control).
Code:
reg outcome post##province, cluster(vce province)
Code:
reg outcome post##province dur, cluster(vce province)
Comment