Comparing IV with Structural Models: What Simple IV Can and Cannot Identify

James J. Heckman and Sergio Urzua ()
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Sergio Urzua: Northwestern University

No 3980, IZA Discussion Papers from Institute for the Study of Labor (IZA)

Abstract: This paper compares the economic questions addressed by instrumental variables estimators with those addressed by structural approaches. We discuss Marschak's Maxim: estimators should be selected on the basis of their ability to answer well-posed economic problems with minimal assumptions. A key identifying assumption that allows structural methods to be more informative than IV can be tested with data and does not have to be imposed.

Keywords: structural approaches; instrumental variables; Marschak's Maxim (search for similar items in EconPapers)
JEL-codes: C31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ecm
Date: 2009-01
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Forthcoming in: Journal of Econometrics

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Related works:
Working Paper: Comparing IV With Structural Models: What Simple IV Can and Cannot Identify (2009)
Working Paper: Comparing IV with Structural Models: What Simple IV Can and Cannot Identify (2009)
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