A practical guide to shift-share instruments

Borusyak, Kirill; Hull, Peter; and Jaravel, XavierORCID logo A practical guide to shift-share instruments Journal of Economic Perspectives, 39 (1). pp. 181-204. ISSN 0895-3309
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A recent econometric literature shows two distinct paths for identification with shift-share instruments, leveraging either many exogenous shifts or exogenous shares. We present the core logic of both paths and practical takeaways via simple checklists. A variety of empirical settings illustrate key points.

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