I think those definitions — did and treatment on the treated — are not correct? Isn’t the Tot is the wald estimator — reduced form divided by first stage. Not compared to baseline. That is at least my understanding — which is why it corresponds to the LATE. But the did explanation isn’t right. It’s a 2x2 comparison between treatment and control on the long difference.
We may be using terms differently and I was just following Minton Mulligan on treatment on the treated. I’m not worried about compliance here so I’m not sure why I need to think about the Wald estimator. Here they use it to mean treated vs baseline. Again, that may not be the norm but it makes sense to me. I’ll defer to you.
I don’t think we differ on DiD either. I’m normalizing the pre treatment gap to zero. But check out their next figure and tell me if they and I am confused
This really clicked for me, especially the concert analogy. It nails what’s been bothering me about how DiD results get casually scaled up. IMO, what we often treat as “impact” is really reallocation: who lost relative to whom, not what happened to the system overall.
The “missing intercept” framing helps explain why these debates so often go nowhere. We argue over slopes while the level shift, the part that hits everyone through prices, wages, and policy responses, quietly disappears from view.
Once markets are this networked, clean control groups start to feel more like a convenience than a reality. Curious whether you see this as mostly a communication problem, how results get interpreted, or a deeper limitation in how we study market-wide shocks at all.
The invisible hand doesn’t always serve the common good. Markets need context, accountability, and human values to prevent self‑interest from turning into distortion.
Well, I am sorry to report that these key differences were not covered or even mentioned in either of my econometrics courses as an econ major at UCI 😤
I think those definitions — did and treatment on the treated — are not correct? Isn’t the Tot is the wald estimator — reduced form divided by first stage. Not compared to baseline. That is at least my understanding — which is why it corresponds to the LATE. But the did explanation isn’t right. It’s a 2x2 comparison between treatment and control on the long difference.
We may be using terms differently and I was just following Minton Mulligan on treatment on the treated. I’m not worried about compliance here so I’m not sure why I need to think about the Wald estimator. Here they use it to mean treated vs baseline. Again, that may not be the norm but it makes sense to me. I’ll defer to you.
I don’t think we differ on DiD either. I’m normalizing the pre treatment gap to zero. But check out their next figure and tell me if they and I am confused
I didn’t understand this. But I WILL be pretending like I did to forward my Austrian priors.
Super interesting piece!
The geometric explanation with R1 to R6 really made clear how DiD, ToT, and scale effect differ from each other! 👍
This really clicked for me, especially the concert analogy. It nails what’s been bothering me about how DiD results get casually scaled up. IMO, what we often treat as “impact” is really reallocation: who lost relative to whom, not what happened to the system overall.
The “missing intercept” framing helps explain why these debates so often go nowhere. We argue over slopes while the level shift, the part that hits everyone through prices, wages, and policy responses, quietly disappears from view.
Once markets are this networked, clean control groups start to feel more like a convenience than a reality. Curious whether you see this as mostly a communication problem, how results get interpreted, or a deeper limitation in how we study market-wide shocks at all.
The invisible hand doesn’t always serve the common good. Markets need context, accountability, and human values to prevent self‑interest from turning into distortion.
Well, I am sorry to report that these key differences were not covered or even mentioned in either of my econometrics courses as an econ major at UCI 😤