Quasi-Experimental Shift-Share Research Designs
NBER WORKING PAPER SERIES QUASI-EXPERIMENTAL SHIFT-SHARE RESEARCH DESIGNS Kirill Borusyak Peter Hull Xavier Jaravel Working Paper 24997 http://www.nber.org/papers/w24997 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 September 2018 We are grateful to Rodrigo Adão, David Autor, Moya Chin, Edward Glaeser, Paul Goldsmith- Pinkham, Larry Katz, Michal Kolesár, Gabriel Kreindler, Jack Liebersohn, Eduardo Morales, Jack Mountjoy, Jörn-Steffen Pischke, Isaac Sorkin, Jann Spiess, and Itzchak Tzachi Raz for helpful comments. We also thank David Autor, David Dorn, and Gordon Hanson for providing replication code and data. An earlier version of this draft was circulated in May 2017 under the title "Consistency and Inference in Bartik Research Designs." The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. © 2018 by Kirill Borusyak, Peter Hull, and Xavier Jaravel. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source. Quasi-Experimental Shift-Share Research Designs Kirill Borusyak, Peter Hull, and Xavier Jaravel NBER Working Paper No. 24997 September 2018 JEL No. C18,C21,C26,F16,J21 ABSTRACT Many empirical studies leverage shift-share (or “Bartik”) instruments that combine a set of aggregate shocks with measures of shock exposure. We derive a necessary and sufficient shock- level orthogonality condition for these instruments to identify causal effects.
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