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A Practical Guide to Shift-Share Instruments

2025/02/01 by Kirill Borusyak, Peter Hull, Xavier Jaravel · 5 citations
Economics, Econometrics and Finance · Social Sciences · #Firm Innovation and Growth #Cultural Industries and Urban Development

paper · pdf · doi:10.1257/jep.20231370

Abstract

A recent econometric literature shows two distinct paths for identification with shift-share instruments, leveraging either many exogenous shifts or exogenous shares. We present the core logic of both paths and practical takeaways via simple checklists. A variety of empirical settings illustrate key points.

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