Joshua Angrist
Joshua Angrist is a distinguished economist, known for his significant contributions to the field of applied econometrics. Born in Columbus, Ohio, in 1960, Angrist's academic journey led him to the Massachusetts Institute of Technology (MIT), where he received his Ph.D. in Economics. His work is particularly notable for its focus on the causal effects of education and labor market interventions. Angrist's innovative approach often involves using natural experiments to draw causal inferences, a method that has greatly influenced contemporary econometric techniques. His research extends to a variety of topics, including the impacts of military service, the effects of school resources on student outcomes, and the economics of education. He co-authored the widely acclaimed book "Mostly Harmless Econometrics" with Jörn-Steffen Pischke, which has become a seminal text in understanding econometrics. Angrist's contributions to the field have been recognized with numerous awards and honors, solidifying his status as a leading figure in modern economics. His work continues to shape policy discussions and academic research, emphasizing the importance of empirical evidence in economics.
Books Mentioned on People I Mostly Admire #70 with Joshua Angrist:
Exploring the Power of Natural Experiments in Economics: Insights from Joshua Angrist and Steven Levitt
Introduction: Unraveling the Mystery of Natural Experiments
Economists Joshua Angrist and Steven Levitt delve into the intriguing world of natural experiments in the 70th episode of the podcast “People I (Mostly) Admire.” This discussion sheds light on the significance and application of natural experiments in economics, a field that both Angrist and Levitt have significantly contributed to through their careers.
The Essence of Natural Experiments
At the core of their conversation is the concept of natural experiments. Unlike controlled experiments where variables are deliberately altered, natural experiments occur organically in the real world, offering unique opportunities to observe causal relationships. Levitt explains the concept using the analogy of randomized experiments, highlighting how natural experiments can mirror these under certain conditions.
The Vietnam Era Draft Lottery: A Case Study
Angrist’s Nobel Prize-winning work on the Vietnam era military draft lottery exemplifies the potency of natural experiments. He discusses the lottery as a quasi-random experiment to study the long-term effects of military service. This involved analyzing the impacts on individuals who were drafted compared to those who weren’t, based solely on their birthdates. The study revealed nuanced insights, such as a $400 annual earnings decrease for veterans, attributable to their military service.
The Maimonides Rule: Educational Insights from Ancient Texts
Another fascinating example is the Maimonides Rule study. This research exploited a rule from ancient Jewish texts, capped class sizes at 40, to understand the impact of class size on student achievement in Israel. Angrist notes that smaller classes generally led to better outcomes, though later research complicated these findings, highlighting the dynamic nature of empirical research.
Navigating the Complexities of Natural Experiments
In the second part of the “People I (Mostly) Admire” podcast episode 70, Joshua Angrist and Steven Levitt continue their exploration of natural experiments in economics. This segment delves deeper into the intricacies of such experiments, offering insights into how they can be used to understand complex economic phenomena.
The Draft Lottery and Economic Impact
Angrist elaborates on his Nobel Prize-winning research on the Vietnam era draft lottery. This natural experiment provided an opportunity to examine the long-term economic impacts of military service. By comparing those drafted based on their birthdates to those who weren’t, Angrist discovered significant findings like the average annual earnings decrease for veterans, thereby offering a nuanced understanding of the draft’s economic consequences.
Maimonides Rule: Educational Impacts from Class Size
The discussion shifts to the Maimonides Rule, which utilized a rule from ancient Jewish texts to study the effects of class size on student achievement in Israel. Angrist explains how changes in class size, dictated by this rule, provided a natural experiment to observe educational outcomes. The initial findings showed improved outcomes with smaller class sizes, but subsequent research with more recent data presented contrasting results, highlighting the complexity and evolving nature of empirical research.
The Challenge of Interpretation and Mechanism in Natural Experiments
Levitt and Angrist touch on the challenges of interpreting results from natural experiments. While such experiments can reveal important facts about the world, they often do not provide clear underlying mechanisms for these findings. This aspect leads to discussions about the importance of being critical and adaptable in empirical research, as new data can sometimes contradict previous findings.
Delving Deeper into Natural Experiments
In the second part of the “People I (Mostly) Admire” podcast, episode 70, host Steven Levitt continues his engaging conversation with economist Joshua Angrist. They delve deeper into the complexities and insights gained from natural experiments, further highlighting their impact on the field of economics.
The Vietnam Draft Lottery: A Closer Look
Angrist elaborates on his Nobel Prize-winning research on the Vietnam era draft lottery, a quintessential example of a natural experiment. He explains how this lottery served as a quasi-random experiment to study the long-term effects of military service on individuals. Angrist sheds light on the intricate method of analyzing these effects, using the draft lottery as an instrumental variable to isolate the causal impact of military service on later life earnings.
The Maimonides Rule Revisited: Evolving Insights
The conversation takes an interesting turn with a revisit to the Maimonides Rule study, which initially found significant benefits of smaller class sizes on student achievement. However, Angrist discusses how subsequent research with more recent data failed to replicate these findings, underscoring the dynamic and often surprising nature of empirical research. He stresses the importance of being critical and adaptable as new data and methods evolve.
The Importance of Empirical Economics
Levitt and Angrist’s dialogue emphasizes the crucial role of empirical economics in understanding complex real-world phenomena. They discuss how natural experiments, despite their limitations, provide valuable insights that controlled experiments may not be able to offer. This part of the podcast highlights the necessity for economists to remain open to new findings and to embrace the changing landscape of empirical research.
Conclusion: A Continual Journey of Discovery
This segment of the podcast episode with Joshua Angrist and Steven Levitt paints a vivid picture of the ongoing journey in the field of empirical economics. It celebrates the power of natural experiments in providing valuable insights, while also acknowledging the challenges and surprises that come with this approach. The conversation is a testament to the ever-evolving nature of economic research and the constant pursuit of knowledge in this field.