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Tag: observational studies

Explanation and the quest for ‘significant’ relationships. Part II

In Part I I argue that the search and discovery of statistically significant relationships does not amount to explanation and is often misplaced in the social sciences because the variables which are purported to have effects on the outcome cannot be manipulated. Just to make sure that my message is not misinterpreted – I am not arguing for a fixation on maximizing R-squared and other measures of model fit in statistical work, instead of the current focus on the size and significance of individual coefficients. R-squared has been rightly criticized as a standard of how good a model is** (see for example here). But I am not aware of any other measure or standard that can convincingly compare the explanatory potential of different models in different contexts. Predictive success might be one way to go, but prediction is altogether something else than explanation. I don’t expect much to change in the future with regard to the problem I outlined. In practice, all one could hope for is some clarity on the part of the researchers whether their objective is to explain (account for) or find significant effects. The standards for evaluating progress towards the former objective (model fit, predictive success, ‘coverage’ in the QCA sense) should be different than the standards for the latter (statistical & practical significance and the practical possibility to manipulate the exogenous variables). Take the so-called garbage-can regressions, for example. These are models with tens of variables all of which are interpreted causally if they reach the magic…

Slavery, ethnic diversity and economic development

What is the impact of the slave trades on economic progress in Africa? Are the modern African states which ‘exported’ a higher number of slaves more likely to be underdeveloped several centuries afterwards? Harvard economist Nathan Nunn addresses these questions in his chapter for the “Natural experiments of history” collection. The edited volume is supposed to showcase a number of innovative methods for doing empirical research to a broader audience, and historians in particular. But what Nunn’s study actually illustrates is the difficulty of making causal inferences based on observational data. He claims that slave exports contributed to economic underdevelopment, partly through impeding ethnic consolidation. But his data is entirely consistent with a very different interpretation: ethnic diversity in a region led to a higher volume of slave exports and is contributing to economic underdevelopment today. If this interpretation is correct, it could render the correlation between slave exports and the lack of economic progress in different African states spurious – a possibility that is not addressed in the chapter. The major argument of Nunn’s piece is summarized in the following scatterplot. Modern African states from which more slaves were captured and exported (correcting for the size of the country) between the XVth and the XIXth centuries are associated with lower incomes per capita in 2000 (see Figure 5.1 on p.162, the plot reproduced below is actually from an article in the Quarterly Journal of Economics which looks essentially the same): The link grows only stronger after we take into…