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Paper · arXiv

Spectral Truncation in Synthetic Control

Synthetic control (SC) matches a treated unit's pre-treatment trajectory to a weighted combination of donor units. We study Spectral SC, which instead matches the treated unit in coordinates defined by the leading temporal singular vectors of the donor panel, and a hybrid estimator that places separately tunable weight on retained and discarded directions, nesting raw-path SC and truncated Spectral SC as endpoints. We prove that the family reduces exactly to raw-path SC at full rank, that exact balance on $K$ retained dimensions with $N_0$ donors is underdetermined whenever $N_0>K+1$, with an affine solution set of dimension $N_0-K-1$, and that spectral imbalance maps to treatment-effect ...

AuthorsMojtaba Eslami
Primary categorystat.ME
Published27 July 2026
Last updated at source27 July 2026
stat.MEcs.AIcs.LGecon.EMstat.AP
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