Overview
Orley Ashenfelter is Joseph Douglas Green 1895 Professor of Economics (emeritus) at Princeton University and a past president of the American Economic Association. He is one of the founders of the modern program evaluation literature in labor economics, pioneering the use of comparison groups and quasi-experimental variation for causal identification. He is also known for the "Ashenfelter dip" — the pre-program earnings decline that confounds naïve before-after training evaluations — and for the Princeton Twins Survey, the most-cited piece of evidence on the magnitude of ability bias in OLS returns-to-schooling estimates. He co-edited multiple volumes of the Handbook of Labor Economics with David Card.
Key Contributions / Features
- Program evaluation and the Ashenfelter dip (Ashenfelter 1978): Early DiD study of the earnings effects of job training programs; discovered that trainees experience a transitory earnings decline in the period immediately before program entry, which means that naïve before-after comparisons overstate the program's causal effect. The dip is a selection artifact — workers enter training partly in response to a bad spell.
- Princeton Twins Survey (Ashenfelter and Krueger 1994; Ashenfelter and Rouse 1998): Collected survey data on identical twins with different education levels. Used one twin's report of the other's schooling as an instrument for measurement-error correction. Key finding: after correcting for measurement error, the within-family return for identical twins is approximately equal to the OLS cross-sectional estimate (~10% below), implying that OLS ability bias is only ~10%. See Returns to Schooling.
- Sibling earnings data (Ashenfelter and Zimmerman 1997): Extended the twins design to brothers and father-son pairs in the NLS. Measurement-error-corrected within-family estimates for brothers are approximately equal to OLS, consistent with small ability bias. Father-son results are more sensitive to assumptions but generally lower.
- Publication bias in IV (Ashenfelter and Harmon 1998): Documented a positive cross-study correlation between the IV-OLS gap and the standard error of the IV estimate in the returns-to-schooling literature, consistent with selective reporting of large, imprecise IV estimates.
Related
Sources