1Alberto Abadie is Professor, John F. Kennedy School of Government, Harvard University, 79 John F. Kennedy Street, Cambridge, MA 02138 . Alexis Diamond is Evaluation Officer, The International Finance Corporation, 2121 Pennsylvania Avenue, Washington, DC 20433 . Jens Hainmueller is Assistant Professor, Department of Political Science, Massachusetts Institute of Technology, 77 Massachusetts Avenue, Cambridge, MA 02139 . In addition, during the course of this study all authors were affiliated with Harvard’s Institute for Quantitative Social Science (IQSS). We thank Joshua Angrist, Jake Bowers, Javier Gardeazabal, Bryan Graham, Dan Hopkins, Rustam Ibragimov, Guido Imbens, Michael Lovenheim, Paul Rosenbaum, Don Rubin, Jas Sekhon, Gary Solon, Chris Winship, and seminar participants at Harvard, Syracuse, Uppsala, the NBER Labor Meetings, and the 2006 APSA Meetings in Philadelphia for helpful comments. Funding for this research was generously provided by NSF grant SES-0350645 (Abadie). The views expressed in this article are not necessarily those of IFC. This article was awarded the 2007 Gosnell Prize for the best work in methods presented at any political science conference during the preceding year. Companion software developed by the authors (Synth package for MATLAB, R, and Stata) is available at the authors’ webpages.