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Ex Ante Evaluation of Social Programs

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  • Petra E. TODD
  • Kenneth I. WOLPIN

Abstract

This paper discusses methods for evaluating the impacts of social programs prior to their implementation. Ex ante evaluation is useful for designing programs that achieve some optimality criteria, such as maximizing impact for a given cost. This paper illustrates the use of behavioral models in predicting the impacts of hypothetical programs in a way that is not functional form dependent. The programs considered are programs that operate by affecting the budget constraint, such as wage subsidy programs, conditional cash transfer programs, and income support programs. In some cases, the behavioral model justifies a completely nonparametric estimation strategy, even when there is no direct variation in the policy instrument. In other cases, stronger assumptions are required to evaluate a program ex ante. We illustrate the application of ex ante evaluation methods using data from the PROGRESA school subsidy randomized experiment in Mexico. We assess the effectiveness of the ex ante prediction method by comparing predictions of program impacts to the impacts measured under the randomized experiment. The subsamples pertain to girls and boys aged 12-15. For the girls, the predicted impacts are fairly similar to the actual impacts, both in magnitude and in replicating the age patterns, with larger impacts observed at higher ages. For boys, the predicted impacts tend to overstate the actual impacts. The ex-ante evaluation method is also used to predict the effects of counterfactual programs that include changes to the subsidy schedule and an unconditional income transfer.

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Bibliographic Info

Article provided by ENSAE in its journal Annals of Economics and Statistics.

Volume (Year): (2008)
Issue (Month): 91-92 ()
Pages: 263-291

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Handle: RePEc:adr:anecst:y:2008:i:91-92:p:13

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  1. James J. Heckman, 2000. "Causal Parameters And Policy Analysis In Economics: A Twentieth Century Retrospective," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 115(1), pages 45-97, February.
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Cited by:
  1. Birol, Ekin & Asare-Marfo, Dorene & Ayele, Gezahegn & Mensah-Bonsu, Akwasi & Ndirangu, Lydia & Okpukpara, Benjamin & Roy, Devesh & Yakhshilikov, Yorbol, 2013. "The impact of avian flu on livelihood outcomes in Africa: evidence from Ethiopia, Ghana, Kenya and Nigeria," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, African Association of Agricultural Economists, vol. 8(4), October.
  2. Petra Todd & Viviana Vélez-Grajales, 2008. "How Pension Rules Affect Work and Contribution Patterns: A Behavioral Model of the Chilean Privatized Pension System," Working Papers, University of Michigan, Michigan Retirement Research Center wp193, University of Michigan, Michigan Retirement Research Center.
  3. Shahidur R. Khandker & Gayatri B. Koolwal & Hussain A. Samad, 2010. "Handbook on Impact Evaluation : Quantitative Methods and Practices," World Bank Publications, The World Bank, number 2693, August.
  4. Estevan, Fernanda, 2013. "The impact of conditional cash transfers on public education expenditures: A political economy approach," European Journal of Political Economy, Elsevier, Elsevier, vol. 32(C), pages 268-284.
  5. Bernard Fortin & Nicolas Jacquemet & Bruce Shearer, 2010. "Labour Supply, Work Effort and Contract Choice: Theory and Evidence on Physicians," Cahiers de recherche, CIRPEE 1034, CIRPEE.
  6. Duflo, Esther & Glennerster, Rachel & Kremer, Michael, 2007. "Using Randomization in Development Economics Research: A Toolkit," CEPR Discussion Papers, C.E.P.R. Discussion Papers 6059, C.E.P.R. Discussion Papers.
  7. Schleyer, Christian & Theesfeld, Insa, 2011. "Agrar- und Umweltpolitiken aus institutioneller Sicht: eine ex-ante Methode zur Politikbewertung," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 60(3).
  8. Cheng, Terence Chai, 2014. "Measuring the effects of reducing subsidies for private insurance on public expenditure for health care," Journal of Health Economics, Elsevier, Elsevier, vol. 33(C), pages 159-179.
  9. Birol, Ekin & Asare-Marfo, Dorene & Ayele, Gezahegn & Mensa-Bonsu, Akwasi & Ndirangu, Lydia & Okpukpara, Benjamin & Roy, Devesh & Yakhshilikov, Yorbol, 2010. "Investigating the role of poultry in livelihoods and the impact of avian flu on livelihoods outcomes in Africa," IFPRI discussion papers, International Food Policy Research Institute (IFPRI) 1011, International Food Policy Research Institute (IFPRI).

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