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Journal Article

Unnatural Experiments? Estimating the Incidence of Endogenous Policies

Timothy Besley and Anne Case
The Economic Journal
Vol. 110, No. 467, Features (Nov., 2000), pp. F672-F694
Published by: Wiley on behalf of the Royal Economic Society
Stable URL: http://www.jstor.org/stable/2667771
Page Count: 23
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Unnatural Experiments? Estimating the Incidence of Endogenous Policies
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Abstract

There are numerous empirical studies that exploit variation in policies over space and time in the U.S. federal system. If state policy making is purposeful action, responsive to economic and political conditions within the state, then it is necessary to identify and control for the forces that lead to these policy changes. This paper investigates the implications of policy endogeneity for a specific policy context - workers' compensation benefits. We contrast different methods of estimation and their pros and cons in this context.

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