Questions tagged [causality]

The relationship between cause and effect.

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1answer
50 views

Interacting covariates with the instrument in the first stage

If I want to run a 2 stage least squares (2SLS) regression with: Relationship of interest: $Y = \alpha + \beta X + \varepsilon $, where $X$ is the endogenous explanatory variable of interest. If I ...
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0answers
29 views

Behavioral responses of tax policy on labour supply ( first time doing Difference in Differences)

I am trying to estimate the causal effects of the The Working Income Tax Benefit (WITB) on the labour supply of married women in Canada. The WITB is essentially equivalent to the EITC. I am looking at ...
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0answers
44 views

What type of econometrics is practised most?

This might sound like a weird question, but what type of econometrics is most common in academia and / or the private sector? Here I am thinking about time series econometrics (Bayesian and ...
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1answer
37 views

Where to find information to establish causation between economic policies and economic data?

I've merely taken a few economic courses in college -not an economics major-, so my knowledge regarding the field is limited. Lately I've been interested in learning about the economic impact of ...
7
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3answers
1k views

Identifying assumption meaning

I am hoping to get a good explanation regarding what is meant by an identifying assumption. In many articles, under empirical strategy, authors state that: we exploit firm level variation to identify ...
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0answers
42 views

Trade-off between “extent of controls” and “quasi-experimental”

I apologize in advance for a long and possibly misworded question. I am trying to get to something but I am not exactly sure how to explain it. Hopefully, you can bear with me and provide me with some ...
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2answers
33 views

causal time series analysis economics

I want to analyse the relationship between the level of globalization,and the level of income inequality between two specific countries. however, I'm quite lost as to which method is good to use (in ...
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0answers
49 views

How will Coronavirus affect Social Security solvency?

The Coronavirus (known by younger millennials as the "Boomer Plague") is estimated to have a cost of life between 100,000 - 240,000 Americans. According to the CDC approximately 80% of deaths ...
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0answers
55 views

Causal Interpretation of $\beta_1$ with a Dummy explanatory variable

Suppose you run a regression (over the entire sample) of hourly earnings $Y$ with an intercept and a binary variable $D$, where $D$ takes on a value of $1$ if the individual has a college degree and $...
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0answers
11 views

Where to find a list of U.S. policy changes for causal studies?

I'm currently trying to figure how the topic of my paper, which is supposed to be related to policy evaluation (causal inference). I thought it would be great if I could first obtain a list of recent ...
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0answers
16 views

One Treated Unit That Becomes Untreated

Suppose I have a set of units $n_i, i = 1,...,N$. One unit was receiving a treatment $n_j = 1$ at times $t=1$ to $t=\tau$. All other units never received the treatment so $\forall t, n_i=0,i\neq j$. ...
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1answer
53 views

Stock return predictability. Why do papers continue to use Granger Causality tests

There is a long literature on stock return predicabtility. When I read papers I see lots of authors still using granger causality tests. It is still prominently taught in undergrad and grad classess....
3
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1answer
142 views

Difference-in-differences with long time horizon and repeated treatments

I have a high-frequency panel dataset on the order of $i=150$ and $t=5000$. I am interested in studying the causal impact of a treatment with the following characteristics: The same unit can be ...
7
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1answer
90 views

How time zones affects causality?

Considering that markets open in different time zones, in general the opening and closing times are different. I suppose that a stock market opening later (in the same day) receive information on the ...
1
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1answer
48 views

Justification for my Random Effects estimation

I need to defend my use of the Random Effects (RE) estimator in my economics project. I've been told in cross validated that the proper place for the question is here. The causal effect of the ...
3
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1answer
84 views

Does mathematical education imply a better salary?

In some sense this is a follow-up to Correlation between salary level and housing prices in a town There I was reminded to ask for causality, not correlation. I am interested in the causal effect of ...
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2answers
105 views

How to estimate loss of customers due to customer support inefficiency?

I have a data about customers and their activity on a website for a two-year period. Also, I have a customer support work evaluation data for a shorter period of that two-year period. The question is: ...
5
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4answers
430 views

The relation between econometrics and machine learning

In my understanding the utility of econometrics versus machine learning is generally argued to be the research of causality. If I'm not wrong, when we put aside experimental economics, the golden ...
3
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1answer
42 views

I'm studying the effect of a law on a sector: how do I select the control group?

I'm planning on using a regression discontinuity design (RDD) to estimate the impact of a sector-specific law on the firms in that sector. I need to create a control group and I have read somewhere in ...
3
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1answer
71 views

Looking for discussion on equilibrium vs dynamic models in econometrics

I'm a statistician/machine learning scientist more familiar with molecular bio than economics. Trying to find out if an issue I perceive in bio modeling also occurs in econometric modeling. A common ...
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0answers
151 views

Difference in Regression Discontinuity Estimates

Suppose I run a regression discontinuity design (RDD) for two different samples - say, separately for regions A and B of the same country. I get RDD estimates that are statistically significant in ...
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0answers
39 views

Partial least square structural equation modeling

The Partial least square structural equation modeling (PLS-PM, PLS-SEM) method to structural equation modeling allows estimating complex cause-effect relationship models with latent variables. This ...
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1answer
38 views

Estimating causal effect for educated people on wages

I have a problem regarding causation and effect. I have a linear model $ wage=\beta_0+\beta_1educ+\beta_2female+\beta_3hourseworked+errorterm$ When I need to estimate the causal effect for educated ...
7
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2answers
303 views

When can economists claim to “understand” an event or phenomenon?

It's a common refrain that economists still don't have a solid grasp of the causes of business cycles (in particular, the Great Depression), despite decades of serious study. What would it take to say ...
2
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1answer
58 views

Group contamination in Regression Discontinuity

I'm an undergraduate student I have an empirical question regarding Regression Discontinuity and Diff-in-Diff methods. I'm currently evaluating the impact on fertility of a Conditional Cash Transfer ...
2
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0answers
73 views

Professors Salary vs Alumni Earning: is the relation causal?

Elyase İskender posted in his blog an interesting plot correlating Professors Salary and Alumni Earnings Relation in US Universities. Is there a good way to establish causality here? Did the highest ...