Synthetic Control builds a counterfactual for a treated unit by weighting control units to match pre-treatment behavior, then compares post-treatment trajectories.

When to Use

  • One (or a few) treated unit(s), many potential controls
  • Clear intervention date and sufficient pre-period history
  • Controls remain untreated during the study window

Workflow

  1. Select donor pool and predictors
  2. Optimize weights to match pre-period outcome/predictors
  3. Validate fit and run placebo tests (in-space/in-time)
  4. Estimate post-period gap and cumulative effect

Diagnostics

  • Pre-period RMSPE and visual fit
  • Placebo distribution of gaps for inference
  • Sensitivity to donor pool composition

Interpretation

Focus on the size and persistence of post-treatment gaps relative to pre-period fit. Discuss placebo results and robustness to alternative donor pools.

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