RT Journal Article
SR Electronic
T1 Alternative Approaches to Evaluation in Empirical Microeconomics
JF Journal of Human Resources
JO J Hum Resour
FD University of Wisconsin Press
SP 565
OP 640
DO 10.3368/jhr.44.3.565
VO 44
IS 3
A1 Richard Blundell
A1 Monica Costa Dias
YR 2009
UL http://jhr.uwpress.org/content/44/3/565.abstract
AB This paper reviews some of the most popular policy evaluation methods in empirical microeconomics: social experiments, natural experiments, matching, instrumental variables, discontinuity design, and control functions. It discusses identification of traditionally used average parameters and more complex distributional parameters. The adequacy, assumptions, and data requirements of each approach are discussed, drawing on empirical evidence from the education and employment policy evaluation literature. A workhorse simulation model of education and earnings is used throughout the paper to discuss and illustrate each approach. The full set of STATA data sets and do-files are available free online and can be used to reproduce all estimation results.