Causal Parameters and Policy Analysis in Economcs: a Twentieth Century Retrospective

57 Pages Posted: 15 Feb 2000 Last revised: 13 Oct 2010

See all articles by James J. Heckman

James J. Heckman

University of Chicago - Department of Economics; National Bureau of Economic Research (NBER); American Bar Foundation; Institute for the Study of Labor (IZA); CESifo (Center for Economic Studies and Ifo Institute)

Date Written: September 1999

Abstract

The major contributions of twentieth century econometrics to knowledge were the definition of causal parameters when agents are constrained by resources and markets and causes are interrelated, the analysis of what is required to recover causal parameters from data (the identification problem), and clarification of the role of causal parameters in policy evaluation and in forecasting the effects of policies never previously experienced. This paper summarizes the development of those ideas by the Cowles Commission, the response to their work by structural econometricians and VAR econometricians, and the response to structural and VAR econometrics by calibrators, advocates of natural and social experiments, and by nonparametric econometricians and statisticians.

Suggested Citation

Heckman, James J., Causal Parameters and Policy Analysis in Economcs: a Twentieth Century Retrospective (September 1999). NBER Working Paper No. w7333. Available at SSRN: https://ssrn.com/abstract=196030

James J. Heckman (Contact Author)

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