|Authors:||James Heckman and Sergio Urzua|
|Date:||31 May 2010|
|Type:||Journal article, Journal of Econometrics, Vol. 156, No. 1, pp. 27--37|
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.