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Direct and Indirect Effects Based on Difference-in-Differences With an Application to Political Preferences Following the Vietnam Draft Lottery

Deuchert, Eva ; Huber, Martin ; Schelker, Mark

In: Journal of Business and Economic Statistics, 2019, vol. 37, no. 4, p. 710-720

We propose a difference-in-differences approach for disentangling a total treatment effect within specific subpopulations into a direct effect and an indirect effect operating through a binary mediating variable. Random treatment assignment along with specific common trend and effect homogeneity assumptions identify the direct effects on the always and never takers, whose mediator is not...