OK, maybe I'm exaggerating a little bit. Synthetic controls methods are actually really similar to the typical differences in differences approach except that more weight is given to "untreated" observations that are more similar to the "treated" observations in the pre-treatment period. You can read more about this intuition here, but even cooler--you can download a STATA program that automates the process of running multiple synthetic control estimations. It even generates visualizations of the results!
And now you're ready. All you need to do now is find interesting policy changes enacted in different states at different times. Stop reading this blog and go read the newspaper!
PS
UConn people: David Simon is our resident expert on synthetic control methods.
I hear about a lot of new recent research on synthetic controls. One problem with synth is that it only gives P-values and not CI, but I think current work has shown how to back out confidence intervals from the method. Also, I heard that there is research on the way working on modifying the method to include multiple outcome variables...
ReplyDelete