Data and code for: Pre-test with Caution: Event-study Estimates After Testing for Parallel Trends

Replication code and data for ''Pre-test with Caution: Event-study Estimates After Testing for Parallel Trends'' by Jonathan Roth, published in AER: Insights. <br><br>The abstract of the paper is as follows: <br><br> This paper discusses two important limitations of the common practice of testing for pre-existing differences in trends (''pre-trends'') when using difference-in-differences and related methods. First, conventional pre-trends tests may have low power. Second, conditioning the analysis on the result of a pre-test can distort estimation and inference, potentially exacerbating the bias of point estimates and undercoverage of confidence intervals. I analyze these issues both in theory and in simulations calibrated to a survey of recent papers in leading economics journals, which suggest that these limitations are important in practice. I conclude with practical recommendations for mitigating these issues.<br>