Econometric terms Flashcards
Instrument variable
Homogenity
Reversed causality
Panel data usage
Staggared adoption
Difference-in-Difference
If different observations (ex. states) had an increase at a different point in time,
Common trends assumption
Difference-in-Difference
=Parallell trend assumption
Placebo tests
Sensitivity check for DiD
Take all control groups (or before-periods of the treatment groups), randomly assign some of them with a placebo treatment status, computer the DID estimates for the placebo treatment
two-way fxed effects
model
Difference-in-Difference and Fixed effect
External validity
The extent to which the estimated causal e ect can be generalized to
other populations, economic settings or related treatments.
Internal validity
Does the experiment provide an estimate of the causal effect in the
population under study?
