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Unpublished Paper
Synthetic Control Estimation Beyond Case Studies: Does the Minimum Wage Reduce Employment?
Panel Data Inference (2017)
  • David Powell, Rand Corporation
Abstract
Panel data are often used in empirical work to account for fixed additive time and unit effects.  The synthetic control estimator relaxes the assumption of additive effects for case studies in which a treated unit adopts a single policy.  This paper generalizes the case study synthetic control estimator to estimate treatment effects for multiple discrete or continuous variables, jointly estimating the treatment effects and synthetic controls for each unit.  Applying the estimator to study the disemployment effects of the minimum wage for teenagers, I estimate an elasticity of -0.44, substantially larger in magnitude than estimates generated using additive fixed effects.
Keywords
  • synthetic control estimation,
  • finite inference,
  • minimum wage,
  • teen employment,
  • panel data,
  • interactive fixed effects,
  • correlated clusters
Disciplines
Publication Date
2017
Citation Information
David Powell. "Synthetic Control Estimation Beyond Case Studies: Does the Minimum Wage Reduce Employment?" Panel Data Inference (2017)
Available at: http://works.bepress.com/david_powell/19/