Retrospectives
Yair Mundlak and the Fixed Effects Estimator
Bibliographic Data
| ID | 4029355 |
|---|---|
| Authors | Marc F Bellemare (Marc F. Bellemare is McKnight Presidential Chair in Applied Economics, Distinguished McKnight University Professor, Distinguished University Teaching Professor, and Northrop Professor, University of Minnesota, St. Paul, Minnesota.), Daniel L Millimet (0000-0001-5178-5993, Daniel L. Millimet is Robert H. and Nancy Dedman Trustee Professor, Southern Methodist University, Dallas, Texas, and Research Fellow, IZA—Institute of Labor Economics, Bonn, Germany. .) |
| Year | 2025 |
| Volume | 39 |
| Issue | 2 |
| Pages | 261-274 |
| Publication date | 2025-05-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | The Journal of Economic Perspectives (JOURNAL) |
| Journal identifiers | ISSN: 0895-3309 • E-ISSN: 1944-7965 |
| Publisher | American Economic Association (PUBLISHER • US) |
| DOI | 10.1257/jep.20241406 |
| OpenAlex | W4410235117 |
| Language | EN |
| Citations received | 3 |
| References cited | 9 |
We discuss Yair Mundlak's (1927-2015) contribution to econometrics through the lens of the fixed effects estimator. We set the stage by discussing Mundlak's life and his seminal 1961 article in the Journal of Farm Economics, showing how it was looking at the right application - the study of agricultural productivity, which had hitherto been thought to be marred by the presence of management bias - that led Mundlak to use the fixed effects estimator. After discussing Mundlak's contribution, we briefly discuss the historical economic and statistical contexts in which he made that contribution. We then highlight the dialogue that took place between the proponents of fixed versus random effects and discuss how Mundlak settled the debate in his 1978 Econometrica article. We conclude by discussing how, between fixed and random effects, the fixed effects estimator won the day, becoming the de facto estimator of choice among applied economists because of the Credibility Revolution, culminating in the popularity nowadays of difference-in-differences designs and of two-way fixed effects estimators
Estimator · Statistics · Fiscal Policy and Economic Growth · Housing Market and Economics · Income, Poverty, and Inequality · Mathematics
Two-Way Fixed Effects, the Two-Way Mundlak Regression, and Difference-in-Differences Estimators
High Wage Workers and High Wage Firms
Random Simultaneous Equations and the Theory of Production
On the Pooling of Time Series and Cross Section Data
Biases in Dynamic Models with Fixed Effects
Specification Tests in Econometrics
Measurement Error in Human Capital and the Black-White Wage Gap
On the Use of Two-Way Fixed Effects Regression Models for Causal Inference with Panel Data
| Unique citing works | 3 |
|---|---|
| Citations per year | 3 |
| Citation span | 2026 - 2026 (1) |
| Citation velocity | current |
| Highly cited | No |
| Citation types | Neutral: 3 |