Journal article
Staggered Difference-in-Differences in Gravity Settings: Revisiting the Effects of Trade Agreements
American economic journal. Applied economics, v 17(1), pp 271-296
01 Jan 2025
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Abstract
We nest an extended two-way fixed effect (ETWFE) estimator for staggered difference-in-differences within the structural gravity model. To test the ETWFE, we estimate the effects of regional trade agreements (RTAs). The results suggest that RTA estimates in the current gravity literature may be biased downward (by more than 50 percent in our sample). Sensitivity analyses confirm the robustness of our main findings and demonstrate the applicability of our methods across settings. We expect the ETWFE methods to have significant implications for estimates of other policy variables in the trade literature and for gravity regressions on migration and foreign direct investment.
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Details
- Title
- Staggered Difference-in-Differences in Gravity Settings: Revisiting the Effects of Trade Agreements
- Creators
- Arne NagengastYoto Yotov
- Publication Details
- American economic journal. Applied economics, v 17(1), pp 271-296
- Publisher
- AMER ECONOMIC ASSOC
- Number of pages
- 26
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Economics (School of Economics)
- Web of Science ID
- WOS:001417292800008
- Scopus ID
- 2-s2.0-105001206149
- Other Identifier
- 991022005787104721
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- Collaboration types
- Domestic collaboration
- International collaboration
- Web of Science research areas
- Economics