Quantile Treatment Effects in Difference in Differences Models Under Dependence Restrictions and with Only Two Time Periods

34 Pages Posted: 13 Feb 2017 Last revised: 15 Feb 2017

See all articles by Brantly Callaway

Brantly Callaway

University of Mississippi - Department of Economics

Tong Li

Vanderbilt University

Tatsushi Oka

Monash University - Department of Econometrics and Business Statistics

Date Written: February 10, 2017

Abstract

This paper shows that the Conditional Quantile Treatment Effect on the Treated can be identified using a combination of: (i) a conditional Distributional Difference in Differences assumption and, (ii) an assumption on the conditional dependence between the change in untreated potential outcomes and the initial level of untreated potential outcomes for the treated group. The second assumption recovers the unknown dependence from the observed dependence for the untreated group. We also consider estimation and inference in the case where all of the covariates are discrete. We propose a uniform inference procedure based on the exchangeable bootstrap and show its validity. We conclude the paper by estimating the effect of state-level changes in the minimum wage on the distribution of earnings for subgroups defined by race, gender, and education.

Keywords: Quantile Treatment Effects, Copula, Panel Data

JEL Classification: C14, C21, C23, C50

Suggested Citation

Callaway, Brantly and Li, Tong and Oka, Tatsushi, Quantile Treatment Effects in Difference in Differences Models Under Dependence Restrictions and with Only Two Time Periods (February 10, 2017). Available at SSRN: https://ssrn.com/abstract=2915947 or http://dx.doi.org/10.2139/ssrn.2915947

Brantly Callaway

University of Mississippi - Department of Economics ( email )

371 Holman Hall
University, MS 38677
United States

Tong Li (Contact Author)

Vanderbilt University ( email )

2301 Vanderbilt Place
Nashville, TN 37240
United States

Tatsushi Oka

Monash University - Department of Econometrics and Business Statistics ( email )

Caulfield Campus
Sir John Monash Drive
Caulfield East, Victoria 3084
Australia

HOME PAGE: http://sites.google.com/site/homepageoka/

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