Assessing the effect of local public policies with synthetic controls and factor models: An application to the French fish market.

Summary This paper proposes an evaluation of the introduction of a new fishing technique in Les Sables d'Olonne on the quality of the fish caught using the synthetic control method and the estimation of factor models. The estimation is conducted on aggregate data at the level of French auctions over the period 2009-2012. Our preferred estimator of the effect of the innovation with constant composition of the species caught is obtained with the factor model and corresponds to an increase of 16.9% in the proportion of fish with the best quality. The synthetic control method leads to a smaller effect of the innovation (8.3%), but it relies on an interpolation from the control auctions which is rather approximate.