Ordinal response generalized difference in differences with varying categories

The health effect of a disability program in Korea

Young Sook Kim, Myoung-jae Lee

Research output: Contribution to journalArticle

Abstract

We consider the use of difference in differences (DD) to evaluate the effect of an activity assistance program on the health of severely disabled Koreans. There are, however, 2 problems in the data: the number of response categories for self-assessed health changed over the waves of the repeated cross-section survey and the "parallel untreated response path" assumption for DD is suspect. We show how to overcome these problems by renormalizing parameters and applying "generalized difference in differences (GDD)." We find a significantly positive effect of the program with DD, but not with GDD. Our solutions should prove useful in applications in which one or other of these problems arise.

Original languageEnglish
JournalHealth Economics (United Kingdom)
DOIs
Publication statusAccepted/In press - 2017

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Korea
Health
Surveys and Questionnaires

Keywords

  • Difference in differences
  • Generalized difference in differences
  • Ordinal response
  • Self-assessed health

ASJC Scopus subject areas

  • Health Policy

Cite this

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abstract = "We consider the use of difference in differences (DD) to evaluate the effect of an activity assistance program on the health of severely disabled Koreans. There are, however, 2 problems in the data: the number of response categories for self-assessed health changed over the waves of the repeated cross-section survey and the {"}parallel untreated response path{"} assumption for DD is suspect. We show how to overcome these problems by renormalizing parameters and applying {"}generalized difference in differences (GDD).{"} We find a significantly positive effect of the program with DD, but not with GDD. Our solutions should prove useful in applications in which one or other of these problems arise.",
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AB - We consider the use of difference in differences (DD) to evaluate the effect of an activity assistance program on the health of severely disabled Koreans. There are, however, 2 problems in the data: the number of response categories for self-assessed health changed over the waves of the repeated cross-section survey and the "parallel untreated response path" assumption for DD is suspect. We show how to overcome these problems by renormalizing parameters and applying "generalized difference in differences (GDD)." We find a significantly positive effect of the program with DD, but not with GDD. Our solutions should prove useful in applications in which one or other of these problems arise.

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KW - Generalized difference in differences

KW - Ordinal response

KW - Self-assessed health

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