Respected members,
I am trying to employ DID as a means of analysis. In my dataset of 287 firms between 2001 and 2016, there was a policy reform in 2010 of including at least 10 percent of female directors. After reading some articles on DID, I have developed the following alternatives to identify the treatment and control groups.
Option 1
Treatment group: Firms that did not have 10% of female directors before 2010.
Control group: Firms that had female directors of 10% or above before 2010.
Option 2
Treatment group: Firms that did not have 10% of female directors before 2010 and had at least 10% of female directors from 2010 onwards.
Control group: Firms that did not have 10% of female directors before 2010 and did not have at least 10% of female directors even after 2010.
The firms that already had at least 10% female directors before 2010 are excluded from the analysis.
Could you please advise me in this regard as to which of the above option (1 or 2) is appropriate?
Thanks in anticipation.
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