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ddtiming

Introduction

ddtiming is a Stata command that implements a decomposition of a difference-in-differences (DD) estimator with variation in treatment timing, based on Goodman-Bacon (2021). The two-way fixed effects DD model is a weighted average of all possible two-group/two period DD estimators. The command generates a scatterplot of 2x2 DD estimates and their associated weights.

R Users

An R package called bacondecomp is available to perform the decomposition.

Caution

ddtiming is not under active development. Stata users should instead use bacondecomp, a more recent implementation of the Bacon decomposition in Stata.

Installation

To install the ddtiming command in Stata, either type into the command window

          net describe ddtiming, from(https://tgoldring.com/code)
          
          net install ddtiming
        

or type

          net install ddtiming, from(https://tgoldring.com/code)
        

Example – No-Fault Divorce Laws

ddtiming can replicate the example in Goodman-Bacon (2021). Download and load a dataset with the timing of no-fault divorce laws and female suicide rates (Stevenson & Wolfers, 2006):

          net get ddtiming
          
          use nofault_divorce.dta
        

For comparison, estimate a two-way fixed effects DD model of female suicide on no-fault divorce reforms:

          areg asmrs treat i.year, a(state) vce(robust)
        

Apply the DD decomposition theorem in Goodman-Bacon (2018) to the two-way fixed effects DD model:

          ddtiming asmrs treat, i(state) t(year)
        

Stata will produce DD estimates, the associated weights, and a scatterplot of the estimates. The scatterplot replicates Fig. 6 in Goodman-Bacon (2021). Additionally, we can add options to the command to modify the look of the scatterplot:

          ddtiming asmrs treat, i(state) t(year) ddline(lwidth(thick)) ///
          ylabel(-30(10)30) legend(order(3 4 1 2)) savegraph(nfd.jpg) ///
          savedata(nfd) replace
        

This command demonstrates the use of ddtiming's options (ddline, savegraph, savedata) and twoway options (ylabel, legend). For descriptions of all options and additional help, type

          help ddtiming
        

Citation

Please cite ddtiming as:

Goldring, T. (2019). ddtiming: Stata module to perform a Goodman-Bacon decomposition of difference-in-differences estimation. tgoldring.github.io/projects/ddtiming

References

Goodman-Bacon, A. (2021). Difference-in-differences with variation in treatment timing. Journal of Econometrics, 225(2), 254–277.

Stevenson, B., & Wolfers, J. (2006). Bargaining in the Shadow of the Law: Divorce Laws and Family Distress. The Quarterly Journal of Economics, 121(1): 267–288.

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