NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Removing the Veil of Ignorance in Assessing the Distributional Impacts of Social Policies

Pedro Carneiro, Karsten T. Hansen, James J. Heckman

NBER Working Paper No. 8840
Issued in March 2002
NBER Program(s):Children, Labor Studies, Public Economics, Economics of Education

This paper summarizes our recent research on evaluating the distributional consequences of social programs. This research advances the economic policy evaluation literature beyond estimating assorted mean impacts to estimate distributions of outcomes generated by different policies and determine how those policies shift persons across the distributions of potential outcomes produced by them. Our approach enables analysts to evaluate the distributional effects of social programs without invoking the 'Veil of Ignorance' assumption often used in the literature in applied welfare economics. Our methods determine which persons are affected by a given policy, where they come from in the ex-ante outcome distribution and what their gains are. We apply our methods to analyze two proposed policy reforms in American education. These reforms benefit the middle class and not the poor.

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Document Object Identifier (DOI): 10.3386/w8840

Published: Carneiro, Pedro, Karsten T. Hansen, and James J. Heckman. "Removing the Veil of Ignorance in Assessing the Distributional Impacts of Social Policies." Swedish Economic Policy Review 8, 2 (Fall 2001): 273-301.

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