Constructing a More Closely Matched Control Group in a Difference-in-Differences Analysis: Its Effect on History Interacting with Group Bias

By Pallavi Basu, Dylan Small
Observational Studies [New journal, currently IMS affiliated] | September 2020

DOI

arxiv.org/abs/2009.06935

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Citation

Basu, Pallavi., Small, Dylan. Constructing a More Closely Matched Control Group in a Difference-in-Differences Analysis: Its Effect on History Interacting with Group Bias Observational Studies [New journal, currently IMS affiliated] arxiv.org/abs/2009.06935.

Observational Studies [New journal, currently IMS affiliated], 2020

Abstract

We study the effect of mountaintop removal mining (MRM) on mortality using a difference--in--differences analysis that makes use of the increase in MRM following the 1990 Clean Air Act Amendments. Difference--in--differences analysis with a control group that differs considerably from a treated group is vulnerable to bias from historical events that have different effects on the groups. Constructing a more closely matched control group by matching a subset of the overall control group to the treated group may result in less bias. For a difference--in--differences analysis of the effect of mountaintop removal mining on mortality, we constructed a more closely matched control group and found a 95% confidence interval that contains substantial adverse effects along with no effect and small beneficial effects.

Pallavi Basu is an Assistant Professor of Operations Management at the Indian School of Business (ISB), where she teaches concepts and approaches in Statistics. Her research interests include the application of statistics in finance, marketing, and other disciplines; high-dimensional statistical inference; large-scale multiple testing; and topics on causal inference.

Professor Basu is a member of the American Statistical Association, the Institute of Mathematical Statistics, and the International Indian Statistical Association. She received her PhD in Business Administration and Statistics from the USC Marshall School of Business and was a postdoctoral fellow at Tel Aviv University. She completed her undergraduate and postgraduate studies in Statistics (specialising in mathematical statistics and probability) from the Indian Statistical Institute (ISI), Kolkata.

Her current research (2023-2026) is partly funded by the Mathematical Research Impact Centric Support (MATRICS) from the Science and Engineering Research Board (SERB), Government of India.

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