handout_2_6_fall11(1) - y = goods imported in a given year...

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2.6 The Question of Causation What different types of links between x and y can explain an observed association between x and y ? dotted line→ association between x and y unbroken line→ cause-and-effect link between x and y Common Response The observed association between the variables x and y is explained by a lurking variable z . Both x and y change in response to changes in z . This common response creates an association even though there may be no direct causal link between x and y . Example #1 x = the student’s SAT score y = the student’s first-year college GPA z = ability Example #2 x = private health spending in a given year ($ billions)
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Unformatted text preview: y = goods imported in a given year ($ billions) z = general economic conditions in a given year Confounding Two variables are confounded when their effects on a response variable cannot be distinguished from each other. The confounded variables may be either explanatory variables or lurking variables. Example #1 x = whether a person regularly attends religious services y = how long the person lives z = healthy living habits Example #2 x = the number of years of education a worker has y = the workers income z = ability 2...
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handout_2_6_fall11(1) - y = goods imported in a given year...

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