03Empirical Tools of Public Finance（课件）- 《财政与金融》同步教学（人民大学·第五版）

3.1 The Important Distinction Between Correlation and Causality 3.2 Measuring Causation with Data We’d Like to Have: Randomized Trials 3.3 Estimating Causation with Data We Actually Get: Observational Data 3.4 Conclusion Empirical Tools of Public Finance 3 1 of 33 1 Empirical Tools of Public Finance 3 This chapter focuses on empirical public finance. Empirical public finance: The use of data and statistical methods to measure the impact of government policy on individuals and markets. Distinguishing between correlations and causal relationship is the key task in empirical public finance. Correlated: Two economic variables are correlated if they move together. Causal: Two economic variables are causally related if the movement of one causes movement of the other. C H A P T E R 3 ■ E M P I R I C A L T O O L S O F P U B L I C F I N A N C E of 33 2 The Important Distinction Between Correlation and Causality 3.1 There are many examples where causation and correlation can get confused. Russian peasant fallacy Breast feeding fallacy SAT training fallacy In statistics, this is called the identification problem: Given that two series are correlated, how do you identify whether one series is causing another? C H A P T E R 3 ■ E M P I R I C A L T O O L S O F P U B L I C F I N A N C E of 33 3 The Problem 3.1 Whenever we see a correlation between A and B, there are three possible explanations: A is causing B. B is causing A. Some third factor is causing both. The general problem that empirical economists face is trying to distinguish among these three explanations. Correlation alone does not imply causation. C H A P T E R 3 ■ E M P I R I C A L T O O L S O F P U B L I C F I N A N C E of 33 4 Example Identification Problem: SAT Prep Courses 3.1 Among Harvard students who took an SAT prep course, SAT scores were 63 points lower than among those who hadn’t. Do prep courses reduce scores (i.e., A causes B)? Do low scores cause people to enroll in prep cou