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Synthetic Difference-in-Differences

By Dmitry Arkhangelsky, Susan Athey, David A. Hirshberg, Guido W. Imbens, and Stefan Wager

òòò½Íø Review, December 2021

We present a new estimator for causal effects with panel data that builds on insights behind the widely used difference-in-differences and synthetic control methods. Relative to these methods we find, both theoretically and empirically, that this "synthet...

Product Innovation, Product Diversification, and Firm Growth: Evidence from Japan's Early Industrialization

By Serguey Braguinsky, Atsushi Ohyama, Tetsuji Okazaki, and Chad Syverson

òòò½Íø Review, December 2021

We explore how firms grow by adding products. We leverage detailed data from Japan's cotton spinning industry at the turn of the last century to do so. This setting allows us to fully characterize the type of differentiation (vertical or horizontal) of ...