Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2026-08-11
Number: 26-056/III
Author-Name: Vahid Moghani
Author-Workplace-Name: Erasmus University Rotterdam
Title: When Is the Mover-Design Event Study Coefficient a Place-Effect Share?
Abstract: Mover-design event studies are a leading approach to separating place effects from sorting. The coefficient is often interpreted as the share of cross-sectional variation in location means due to places. I show the coefficient depends on how movers connect locations: two economies can be identical in place effects, sorting, and location means, yet deliver different mover coefficients. Only under directional isotropy, a testable condition, does the coefficient permit a cross-sectional reading: it averages the variance share of place effects and the share that equalizing them removes. An illustration in Dutch employer–employee wage data rejects the condition.
Classification-JEL: C23, C52, J31
Keywords: mover design, place effects, two-way fixed effects
File-URL: https://papers.tinbergen.nl/26056.pdf
File-Format: application/pdf
File-Size: 576.557 bytes
Handle: RePEc:tin:wpaper:20260056