Synthetic Control Method (SCM)
Builds a counterfactual for a treated unit from a weighted combination of untreated units.
Last updated: 2026-05-04
Definition
When you can't find a single clean control group (e.g., you launched a campaign in Mumbai and want to know the lift), SCM constructs a synthetic Mumbai from Bangalore + Hyderabad + Pune weighted to match Mumbai's pre-treatment trajectory. The post-treatment gap between real Mumbai and synthetic Mumbai is the causal effect.
How it applies in India
Particularly useful for India geo-experiments because the natural geographic clusters (NCR vs South vs East) often have parallel-enough pre-trends to make synthetic controls feasible.
Related terms
- Causal InferenceStatistical methods that estimate causal effects from observational or experimental data.
- Difference-in-Differences (DiD)A causal method that compares the change in outcome over time between a treated group and a control group.
- Geo-Lift TestA causal experiment that runs a campaign in some geographies and not others, then measures the difference.
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