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Estimating causal effects: considering three alternatives to difference-in-differences estimation
- Source :
- Europe PubMed Central, O'Neill, S, Kreif, N, Grieve, R, Sutton, M & Sekhon, J S 2016, ' Estimating causal effects: considering three alternatives to difference-in-differences estimation ', Health Services and Outcomes Research Methodology, vol. 16, no. 1, pp. 1-21 . https://doi.org/10.1007/s10742-016-0146-8, Health Services & Outcomes Research Methodology
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Abstract
- Difference-in-differences (DiD) estimators provide unbiased treatment effect estimates when, in the absence of treatment, the average outcomes for the treated and control groups would have followed parallel trends over time. This assumption is implausible in many settings. An alternative assumption is that the potential outcomes are independent of treatment status, conditional on past outcomes. This paper considers three methods that share this assumption: the synthetic control method, a lagged dependent variable (LDV) regression approach, and matching on past outcomes. Our motivating empirical study is an evaluation of a hospital pay-for-performance scheme in England, the best practice tariffs programme. The conclusions of the original DiD analysis are sensitive to the choice of approach. We conduct a Monte Carlo simulation study that investigates these methods’ performance. While DiD produces unbiased estimates when the parallel trends assumption holds, the alternative approaches provide less biased estimates of treatment effects when it is violated. In these cases, the LDV approach produces the most efficient and least biased estimates. Electronic supplementary material The online version of this article (doi:10.1007/s10742-016-0146-8) contains supplementary material, which is available to authorized users.
- Subjects :
- Matching (statistics)
Pay-for-performance
Difference-in-differences
media_common.quotation_subject
Pay for performance
Article
Policy evaluation
03 medical and health sciences
0302 clinical medicine
Empirical research
Statistics
Econometrics
Matching
030212 general & internal medicine
I10
C33
Mathematics
media_common
Estimation
Synthetic control method
Variables
I18
030503 health policy & services
Health Policy
Public Health, Environmental and Occupational Health
Estimator
Difference in differences
Regression
3. Good health
0305 other medical science
Subjects
Details
- ISSN :
- 15729400 and 13873741
- Database :
- OpenAIRE
- Journal :
- Europe PubMed Central, O'Neill, S, Kreif, N, Grieve, R, Sutton, M & Sekhon, J S 2016, ' Estimating causal effects: considering three alternatives to difference-in-differences estimation ', Health Services and Outcomes Research Methodology, vol. 16, no. 1, pp. 1-21 . https://doi.org/10.1007/s10742-016-0146-8, Health Services & Outcomes Research Methodology
- Accession number :
- edsair.doi.dedup.....9af0c964d44801079e54a0bddfa9cc62