Working Paper: NBER ID: w26824
Authors: Isaiah Andrews; Jesse M. Shapiro
Abstract: We propose a positive model of empirical science in which an analyst makes a report to an audience after observing some data. Agents in the audience may differ in their beliefs or objectives, and may therefore update or act differently following a given report. We contrast the proposed model with a classical model of statistics in which the report directly determines the payoff. We identify settings in which the predictions of the proposed model differ from those of the classical model, and seem to better match practice.
Keywords: scientific communication; decision theory; empirical science
JEL Codes: C18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| reports not reflecting underlying data (Y10) | different optimal decisions (C61) |
| coarsening analyst's report (G24) | higher communication risk (L96) |
| communication model (L96) | decision-making outcomes (D70) |
| censoring negative estimates (C24) | poorer decision-making outcomes (D91) |
| uncensored reports (Y30) | better decision-making outcomes (D91) |