Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/148475
Authors: 
Becker, Sascha O.
Year of Publication: 
2016
Citation: 
[Journal:] IZA World of Labor [ISSN:] 2054-9571 [Year:] 2016 [Issue:] 250
Abstract: 
Randomized control trials are often considered the gold standard to establish causality. However, in many policy-relevant situations, these trials are not possible. Instrumental variables affect the outcome only via a specific treatment; as such, they allow for the estimation of a causal effect. However, finding valid instruments is difficult. Moreover, instrumental variables estimates recover a causal effect only for a specific part of the population. While those limitations are important, the objective of establishing causality remains; and instrumental variables are an important econometric tool to achieve this objective.
Subjects: 
natural experiments
quasi-natural experiments
treatment effects
local average treatment effect
omitted variable bias
reverse causality
JEL: 
C01
C26
Persistent Identifier of the first edition: 
Document Type: 
Article

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