Hello,

This is not a stata question per se, but an economics one and hope you would be able to offer some guidance.

I've been trying to understand the importance of the exogenous variable when it comes to causal inference. Let's say I want to understand the impact of aid on changing attitudes of the local population regarding donor countries (does aid improve the perception of donor countries among local communities?). In this case aid is not a exogenous variable, can I use a causal inference to understand how receiving aid affects perceptions of donor countries? Assuming I have two communities, one that received aid and another that did not. What exactly has to be exogenous? Do I need to find an instrumental variable for this (and that has to be exogenous?). Any good reading material that could help me understand the basics?

Thanks!