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Alternative Approaches to Evaluation in Empirical Microeconomics

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Author Info
Blundell, Richard () (University College London)
Costa Dias, Monica () (Institute for Fiscal Studies, London)

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Abstract

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 returns is used throughout the paper to discuss and illustrate each approach. The full set of STATA datasets and do-files are available free online and can be used to reproduce all estimation and simulation results.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3800.

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Date of creation: Oct 2008
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Publication status: forthcoming in: Journal of Human Resources
Handle: RePEc:iza:izadps:dp3800

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Related research
Keywords: evaluation methods;

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Find related papers by JEL classification:
C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation and Testing
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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