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Village A introduces an adult education programme, and its literacy rate rises from 60% to 75%. Village B does not introduce the programme, and its rate rises from 50% to 60%. What is the difference-in-differences estimate?

Answer and explanation

Correct answer: 5 percentage points

Village A improves by 15 percentage points, and Village B improves by 10 percentage points. The difference-in-differences estimate is 15 minus 10, or 5 percentage points. Interpreting this as a causal effect requires assumptions, including comparable trends without the programme.

Related tags

Difference In DifferencesProgramme EvaluationLiteracy RateCausal Inference

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