Computing Statistical Power for the Difference in Differences Design

The difference in differences design is widely used to assess treatment effects in natural experiments or other situations where random assignment cannot, or is not, used (see, e.g., Angrist & Pischke, 2009). The researcher must make important decisions about which comparisons to make, the measurements to make, and perhaps the number of individuals whose data is included in each timepoint. Also, interpretation of any statistical results, particularly null results, is improved by understanding the sensitivity of the design. This paper describes methods for computing the statistical power for tests of treatment effects in the difference in differences design. We describe alternative approaches to the analysis of the design, show which are equivalent, and provide expressions for computing statistical power and determining minimum detectable effect sizes. We then discuss how these methods could be generalized to unbalanced designs, designs with covariates, and designs more than two timepoints including difference in difference in differences designs.

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Publication Details

Journal
Evaluation Review
Published
2025-09-22
DOI
https://doi.org/10.1177/0193841x251380898
Primary Topic
Optimal Experimental Design Methods
Type
article
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article

Computing Statistical Power for the Difference in Differences Design

E. C. Hedberg, Larry V. Hedges
Evaluation Review
Optimal Experimental Design Methods
article

Computing Statistical Power for the Difference in Differences Design

E. C. Hedberg, Larry V. Hedges
article en

Abstract

The difference in differences design is widely used to assess treatment effects in natural experiments or other situations where random assignment cannot, or is not, used (see, e.g., Angrist & Pischke, 2009). The researcher must make important decisions about which comparisons to make, the measurements to make, and perhaps the number of individuals whose data is included in each timepoint. Also, interpretation of any statistical results, particularly null results, is improved by understanding the sensitivity of the design. This paper describes methods for computing the statistical power for tests of treatment effects in the difference in differences design. We describe alternative approaches to the analysis of the design, show which are equivalent, and provide expressions for computing statistical power and determining minimum detectable effect sizes. We then discuss how these methods could be generalized to unbalanced designs, designs with covariates, and designs more than two timepoints including difference in difference in differences designs.

Evaluation ReviewVol. 50(1)
Northwestern University (US), Health Effects Institute (US), Radiation Effects Research Foundation (JP)
Openalex Percentile: Top 70%
Optimal Experimental Design Methods
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