## Appendix: Mastering Inference

YOUNG CAINE: I am puzzled.

master po: That is the beginning of wisdom.

Kung Fu, Season 2, Episode 25

This is the first of a number of appendices that fill in key econometric and statistical details. You can spend your life studying statistical inference; many masters do. Here we offer a brief sketch of essential ideas and basic statistical tools, enough to understand tables like those in this chapter.

The HIE is based on a sample of participants drawn (more or less) at random from the population eligible for the experiment. Drawing another sample from the same population, we’d get somewhat different results, but the general picture should be similar if the sample is large enough for the LLN to kick in...

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