Category THE PATH FROM CAUSE TO EFFECT

The Oregon Trail

master kan: Truth is hard to understand.

kwai chang caine: It is a fact, it is not the truth. Truth is often hidden, like a shadow in darkness.

Kung Fu, Season 1, Episode 14

The HIE was an ambitious attempt to assess the impact of health insurance on health-care costs and health. And yet, as far as the contemporary debate over health insurance goes, the HIE might have missed the mark. For one thing, each HIE treatment group had at least catastrophic coverage, so financial liability for health-care costs was limited under every treatment. More importantly, today’s uninsured Americans differ considerably from the HIE population: most of the uninsured are younger, less educated, poorer, and less likely to be working...

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Differences-in-Differences

master kan: If while building a house, a carpenter strikes a nail and it proves faulty by bending, does the carpenter lose faith in all nails and stop building? So it is with empirical work.

Kung Fu, Season 1, Episode 7

Our Path

Credible instrumental variables and dramatic policy discontinuities can be hard to find;

you’ll need other ’metrics tools in your kit too. The differences-in-differences (DD) method recognizes that in the absence of random assignment, treatment and control groups are likely to differ for many reasons. Sometimes, however, treatment and control outcomes move in parallel in the absence of treatment. When they do, the divergence of a post­treatment path from the trend established by a comparison group may signal a treatment effect...

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Regression Sensitivity Analysis

Because we can never be sure whether a given set of controls is enough to eliminate selection bias, it’s important to ask how sensitive regression results are to changes in the list of controls. Our confidence in regression estimates of causal effects grows when treatment effects are insensitive—masters say “robust”—to whether a particular variable is added or dropped as long as a few core controls are always included in the model. This desirable pattern is illustrated by columns (4)-(6) in Tables 2.2-2.3. which show that estimates of the private school premium are insensitive to the inclusion of students’ ability (as measured by own SAT scores), parental income, and a few other control variables, once we control for the nature of the schools to which students applied.

The OVB ...

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Twins Double the Fun

Twinsburg, Ohio, near Cleveland, was founded as Millsville in the early nineteenth century. Prosperous Millsville businessmen Moses and Aaron Wilcox were identical twins whom few could distinguish. Moses and Aaron were generous to Millsville in their success, a fact recognized when Millsville was renamed Twinsburg in the early nineteenth century. Since 1976, Twinsburg has embraced its zygotic heritage in the form of a summer festival celebrating twins. Millsville’s annual Twins Days attract not only twins reveling in their similarities but also researchers looking for well-controlled comparisons.

Twin siblings indeed have much in common: most grow up in the same family at the same time, while identical twins even share genes...

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Abuse Busters

The police were called to O. J. Simpson’s Los Angeles mansion at least nine times over the course of his marriage to Nicole Brown Simpson. But the former National Football League superstar, nicknamed “The Juice,” was arrested only once, in 1989, when he pleaded no contest to a charge of spousal abuse in an episode that put Nicole in the hospital. Simpson paid a small fine, did token community service, and was ordered to seek counseling from the psychiatrist of his choice. The prosecutor in the 1989 case, Robert Pingle, noted that Nicole had not been very cooperative with authorities in the aftermath of her severe beating. Five years later, Nicole Brown Simpson and her companion Ronald Goldman were murdered by an unknown intruder whom many believe was Nicole’s ex – husband, O. J.-

H...

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Masters of ’Metrics: From Daniel to R. A. Fisher

The value of a control group was revealed in the Old Testament. The Book of Daniel recounts how Babylonian King Nebuchadnezzar decided to groom Daniel and other Israelite captives for his royal service. As slavery goes, this wasn’t a bad gig, since the king ordered his captives be fed “food and wine from the king’s table.” Daniel was uneasy about the rich diet, however, preferring modest vegetarian fare. The king’s chamberlains initially refused Daniel’s special meals request, fearing that his diet would prove inadequate for one called on to serve the king. Daniel, not without chutzpah, proposed a controlled experiment: “Test your servants for ten days. Give us nothing but vegetables to eat and water to drink...

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