Quasi-experimental and experimental approaches to environmental economics
Author(s)Greenstone, Michael; Gayer, Ted
Massachusetts Institute of Technology. Center for Energy and Environmental Policy Research.
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This paper argues that an increased application of quasi-experimental and experimental techniques will improve understanding about core environmental economics questions. This argument is supported by a review of the limitations of associational evidence in assessing causal hypotheses. The paper also discusses the benefits of experiments and quasi-experiments, outlines some quasi-experimental methods, and highlights threats to their validity. It then illustrates the quasi-experimental method by assessing the validity of a quasi-experiment that aims to estimate the impact of the Endangered Species Act on property markets in North Carolina. The paper's larger argument is that greater application of experimental and quasi-experimental techniques can identify efficient policies that increase social welfare.
MIT Center for Energy and Environmental Policy Research
MIT-CEEPR (Series) ; 07-013WP.