InstrumentalVariablesandtheSearchforIdentification.PDFVIP

Journal of Economic Perspectives—Volume 15, Number 4—Fall 2001—Pages 69–85 Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments Joshua D. Angrist and Alan B. Krueger he method of instrumental variables is a signature technique in the econometrics toolkit. The canonical example, and earliest applications, of Tinstrumental variables involved attempts to estimate demand and supply curves.1 Economists such as P.G. Wright, Henry Schultz, Elmer Working and Ragnar F