Difference in differences

Difference in differences (sometimes abbreviated 'DID' or 'DD') is a statistical technique used in econometrics  and quantitative sociology that attempts to mimic an experimental research design using observational study data, by studying the effect of a treatment on a 'treatment group' versus a 'control group'. It calculates the effect of a treatment (i.e., an explanatory variable or an independent variable) on an outcome (i.e., a response variable or dependent variable) by comparing the average change over time in the outcome variable for the treatment group, compared to the average change over time for the control group. Although it is intended to mitigate the effects of extraneous factors and selection bias, depending on how the treatment group is chosen, this method may still be subject to certain biases (e.g. mean regression, reverse causality and omitted variable bias).