Title: Estimating Heterogeneous Event-studies for Policy Evaluation: Application to the Child-penalty (joint with Dmitry Arkhangelsky & Kazuharu Yanagimoto)

Abstract: Staggered adoption designs – situations where units are sequentially exposed to a treatment – are widely used in applied economics. The impact of the treatment tends to vary across units and to summarize this heterogeneity researchers commonly report an average effect, for the sake of ease of estimation and interpretation. At the same time, certain economic questions require us to go beyond the average effects and investigate the underlying unit-level heterogeneity directly. This paper provides a practical toolkit for analyzing unobserved heterogeneity in two-way fixed-effect models. We develop an estimation algorithm and adapt existing econometric results to provide its theoretical justification. We apply these tools to study individual heterogeneity in the child-penalty context in three ways: (1) quantifying the unobserved heterogeneity present within CP, (2) exploring the economic impact of childcare policies on CP and deducing the elasticity inherent in such policies, and (3) using the estimated individual-level CP on the right-hand-side to study the intergenerational transmission of CP.