Hi,

I would like to investigate the effects of a natural disaster on individuals. Therefore I have been using a difference-in-difference method. My main regression so far is as given below:

This was I was controlling for individual fixed effects (thorugh
), year fixed effects (through
, and I was looking at the breakdown of the treatmenteffect (through
, where each
.

Now as an alternative way I want to use propensity score matching and want to use the
code. Regarding this I have two questions:

1. I have read the manual for the function but I am not sure what the function does. I have a treatment group (
) and a control group (
). I want the function to match each individual from the treatment group with one individual from the control group. Therefore when I specify the function as below is this the case?

2. Does the above code mean that the function does the matching based on the variables
?

3. The shock has been observed in 2010. Therefore a in my difference-in-difference estimation I can look at the effects before and after the shock through
where
is for 2010 and later. How can I do that here? Can I do that here?

4. Is it possible to control for fixed effects using
, i.e. I want to control for individual as well as year fixed effects? Or is the control for individual fixed effects already done through the matching process? In that case how can I control for year fixed effects?

I know those are many questions but I have now been reading for 2-3 weeks about this and I still could not solve this issue. Any help or answer to any of the questions would be highly appreciated..

Kind regards.

I would like to investigate the effects of a natural disaster on individuals. Therefore I have been using a difference-in-difference method. My main regression so far is as given below:

Code:

xtreg outcome_var FY2007 FY2008 FY2009 FY2011 FY2012 FY2013 didFY2007 didFY2008 didFY2009 didFY2011 didFY2012 didFY2013 if inrange(wave,2008,2014), fe

Code:

,fe

Code:

FY2007 FY2008 FY2009 FY2011 FY2012 FY2013

Code:

didFY2007 didFY2008 didFY2009 didFY2011 didFY2012 didFY2013

Code:

didFY2007=treatment*financialyear2007

Now as an alternative way I want to use propensity score matching and want to use the

Code:

teffects psmatch

1. I have read the manual for the function but I am not sure what the function does. I have a treatment group (

Code:

intreatmentgroup==1

Code:

intreatmentgroup==0

Code:

teffects psmatch (outcome_var) (intreatmentgroup cleanedhigh1 cleanesempst hgsex hhtype cleanhstenr,probit)

Code:

cleanedhigh1 cleanesempst hgsex hhtype cleanhsten

3. The shock has been observed in 2010. Therefore a in my difference-in-difference estimation I can look at the effects before and after the shock through

Code:

did=treatment*post

Code:

post

4. Is it possible to control for fixed effects using

Code:

teffects psmatch

I know those are many questions but I have now been reading for 2-3 weeks about this and I still could not solve this issue. Any help or answer to any of the questions would be highly appreciated..

Kind regards.

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