This paper compares the structural approach to economic policy analysis with the program evaluation approach. It offers a third way to do policy analysis that combines the best features of both approaches. We illustrate the value of this alternative approach by making the implicit economics of...

This paper considers the problem of policy evaluation in a modern society with heterogeneous agents and diverse groups with conflicting interests. Several different approaches to the policy evaluation problem are compared including the approach adopted in modern welfare economics, the classical...

This paper considers the use of instrumental variables to estimate the mean effect of treatment on the treated. It reviews previous work on this topic by Heckman and Robb (1985, 1986) and demonstrates that (a) unless the effect of treatment is the same for everyone (conditional on observables),...

This paper considers the recent case for randomized social experimentation and contrasts it with older cases for social experimentation. The recent case eschews behavioral models, assumes that certain mean differences in outcomes are the parameters of interest to evaluators and assumes that...

The recent literature on evaluating manpower training programs demonstrates that alternative nonexperimental estimators of the same program produce a array of estimates of program impact. These findings have led to the call for experiments to be used to perform credible program evaluations....

This paper uses the marginal treatment effect (MTE) to unify the nonparametric literature on treatment effects with the econometric literature on structural estimation using a nonparametric analog of a policy invariant parameter; to generate a variety of treatment effects from a common...

This paper uses the marginal treatment effect (MTE) to unify the nonparametric literature on treatment effects with the econometric literature on structural estimation using a nonparametric analog of a policy invariant parameter; to generate a variety of treatment effects from a common...

This paper investigates four topics. (1) It examines the different roles played by the propensity score (probability of selection) in matching, instrumental variable and control functions methods. (2) It contrasts the roles of exclusion restrictions in matching and selection models. (3) It...

An open question in the literature is whether families compensate or reinforce the impact of child health shocks. Discussions usually focus on one dimension of child investment. This paper examines multiple dimensions using household survey data on Chinese child twins whose average age is 11. We...

This paper formulates a structural dynamic programming model of preschool investment choices of altruistic parents and then empirically estimates the structural parameters of the model using the NLSY79 data. The paper finds that preschool investment significantly boosts cognitive and...