Ex Ante Evaluation of Social Programs

33 Pages Posted: 19 Sep 2006

See all articles by Petra Todd

Petra Todd

University of Pennsylvania - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Kenneth I. Wolpin

University of Pennsylvania - Department of Economics

Date Written: May 2, 2006

Abstract

This paper discusses methods for evaluating the impacts of social programs prior to their implementation. Ex ante evaluation is useful for designing programs that achieve some optimality criteria, such as maximizing impact for a given cost. This paper illustrates through several examples the use of behavioral models in predicting the impacts of hypothetical programs. Among the programs considered are wage subsidy programs, conditional cash transfer programs, and income support programs. In some cases, the behavioral model justifies a completely nonparametric estimation strategy, even when there is no direct variation in the policy instrument. In other cases, stronger modeling and/or functional form assumptions are required to evaluate a program ex ante. We illustrate the application of ex ante evaluation methods using data from the PROGRESA school subsidy experiment in Mexico. We assess the effectiveness of the method by comparing ex ante predictions of program impacts to the impacts measured under the randomized experiment.

Keywords: ex-ante evaluation, matching, evaluation methods, school subsidy programs

JEL Classification: J22, C21, H31

Suggested Citation

Todd, Petra and Wolpin, Kenneth I., Ex Ante Evaluation of Social Programs (May 2, 2006). PIER Working Paper No. 06-022, Available at SSRN: https://ssrn.com/abstract=931393 or http://dx.doi.org/10.2139/ssrn.931393

Petra Todd (Contact Author)

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Kenneth I. Wolpin

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States
215-898-7708 (Phone)
215-573-2057 (Fax)

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