Friday, October 31, 2014

Thursday, October 30, 2014

Epistemological irritation of the day

The text for today's (very short) sermon is:

"A direct test of the hypothesis is looking for significance in the relationship between [one variable] and {another variable]."

No, no, no, no, no. Theory makes predictions about signs of coefficients, not about significance levels, which also depend on minor details such as the sample size and the amount of variation in the independent variable of interest present in the data.


Addendum: academic readers will know from the season that the text is taken from someone's job market paper.

Saturday, October 18, 2014

A delightfully nasty political commercial

I'm a big fan of negative political advertising. This is an especially good one.


Hat tip to reason.

Friday, October 17, 2014

Evan Starr on non-competes

Recent UM doctorate Evan Starr, now at the University of Illinois at Urbana-Champaign, makes it on to the local news in Champaign for a story about Jimmy John's having its workers sign non-compete agreements, which (more broadly) were the subject of his dissertation research.

Best parts (local news always delivers ...):

1. CSI-like closeup of Evan writing on a pad of paper with his mechanical pencil
2. The importance shown to interviews with random uninformed people at a strip mall

Wednesday, September 3, 2014

Book: Ready Player One by Ernest Cline

Cline, Ernest. 2011. Ready Player One. Broadway Books.

Saying anything very negative about this book would be a bit like kicking a puppy. This is a very sweet science fiction book about a geeky young fellow who saves the (virtual) world via his knowledge of 80s pop culture and video game history. That's really all you need to know.

Recommended if you are into such things.

Tuesday, August 26, 2014

Learning about what observed variables you need for selection on observed variables to be a reasonable assumption

I like this paper a lot, both in the narrow sense that it presents interesting and useful results that I have already been citing, but also more generally because it follows the path that I think the literature should follow but rarely does. That path takes claims about the important of selection on unobserved variables in particular contexts and puts them to an empirical test.

Marco Caliendo, Robert Mahlstedt, Oscar A. Mitnik:

Unobservable, but Unimportant? The Influence of Personality Traits (and Other Usually Unobserved Variables) for the Evaluation of Labor Market Policies

Many commonly used treatment effects estimators rely on the unconfoundedness assumption ("selection on observables") which is fundamentally non-testable. When evaluating the effects of labor market policies, researchers need to observe variables that affect both treatment participation and labor market outcomes. Even though in many countries it is possible to access (very) informative administrative data, concerns about the validity of the unconfoundedness assumption remain. The main concern is that the observed characteristics of the individuals may not be enough to properly address potential selection bias. This is especially relevant in light of the research on the influence of personality traits and attitudes on economic outcomes. We exploit a unique dataset that contains a rich set of administrative information on individuals entering unemployment in Germany, as well as several usually unobserved characteristics like personality traits, attitudes, expectations, and job search behavior. This allows us to empirically assess how estimators based on the unconfoundedness assumption perform when alternatively including or not these usually unobserved variables. Our findings indicate that these variables play a significant role for selection into treatment and labor market outcomes, but do not make for the most part a significant difference in the estimation of treatment effects, compared to specifications that include detailed labor market histories. This suggests that rich administrative data may be good enough to draw policy conclusions on the effectiveness of active labor market policies.

Monday, August 25, 2014

The neighborhood lawsuit

The lawsuit described in this astounding Ann Arbor Observer article took place over access to a path in my neighborhood.

Wow. All those lawyer fees could have made for some block party. Or maybe some big notation to a more deserving group?

Full disclosure: we don't know any of the parties to the suit very well, but know the folks who shut down the trail better.