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  • Diff in Diff with different times

    Dear Statalisters,

    I am studying the following question: "What is the impact of distributing dividends on sales while the firm is experiencing a loss"?
    I have the following information
    Firm year Distribute=1 Sales
    F1 2000 1 1000
    F1 2001 1 2000
    F1 2002 0 500
    F2 2000 1 1000
    F2 2001 0 2500
    F2 2002 1 3000
    F3 2000 1 2500
    F3 2001 1 2550
    F3 2002 1 3000
    The question here: can I use Diff in Diff in this case? Please note that here I cannot insert a time from which the program starts as there is not fixed year of program. This totally depends on the firm and the year of treatment. Please note also that some firms have always 1 (such as the third firm).
    If can I use diff in diff, what command can fit my data so I have robust results?
    Last edited by Mina Sami; 04 Dec 2018, 03:50.

  • #2
    This data design is not suitable for a diff-in-diff analysis. You have neither a treatment nor a control group, and the distribution variable goes on and off haphazardly over time. You can still analyze this data just using the distribution variable, and probably including fixed effects for both firm and year. But it won't be a diff-in-diff analysis, and its identification of causal effect will not be as strong as that of a diff-in-diff analysis.

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