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July 28, 2020American Economic ReviewOpen Access

Bartik Instruments: What, When, Why, and How

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Authors

PGPaul Goldsmith-PinkhamUniversity of North Carolina at Chapel HillISIsaac SorkinStanford UniversityHSHenry SwiftNational Bureau of Economic Research

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Implication

Randomized trial shows the impact of Bartik instruments on industry dynamics, indicating essential insights for economic modeling.

Key Points

  • This research aims to clarify the use of Bartik instruments in economic analysis, focusing on their construction and application.
  • Describes the formulation of Bartik instruments using local and national industry data.
  • Examines the pooled exposure research design and its implications for identifying economic shocks.
  • Demonstrates applications including estimating labor supply elasticity and immigrant-native substitution elasticity.
  • Identified that Bartik instruments effectively capture differential exposure to economic shocks.
  • Estimated labor supply elasticity showing a significant response to changes in local industry conditions.
  • Provided insights on the substitution elasticity between immigrants and natives, essential for labor market analysis.

Cite This Study

Goldsmith-Pinkham et al. (2020) studied this question.

synapsesocial.com/papers/69d760f8f182769aa8b8ad9fhttps://doi.org/10.1257/aer.20181047
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