Dear all,

I currently try to carry out a diff-in-diff analysis under the use of two cross-sectional datasets with individual observations that I want to combine to a pseudo-panel (two rounds of the DHS surveys).
However, I am a bit confused concerning the adjustments I have to do in STATA to have a panel dataset.

The cohorts into which I want to group my individual observations is the district in the country of analysis (Ethiopia), such that I will evaluate differences at district-level. For a pseudo-panel, I would have to take the averages within each district and compare the averages between the same districts across the two survey rounds. Nevertheless, I would still like to keep the individual observations in my data without collapsing the data at district level.

So far, I only appended the two cross-sections into one dataset. In the appended dataset, I have observations for districts that appear in either of the two rounds and that appear in both rounds. Of course, I can only make use of the observations that lie in districts that are sampled in both rounds.
However, I was wondering how I can make sure that only the observations of the same district are being compared across the two rounds? Do I first have to match same districts across the two rounds? Is this done e.g. via "xtset district", to define the data as panel data at district level?
Or, does STATA already incorporate that if I run a simple DID regression, such as:
Code:
reg y post Treatment post*Treatment, cluster(district)
Thanks a lot in advance!
Till