Cemmap Seminar presented by Alberto Abadie (MIT)
05 March 2019, 12:30 pm–1:30 pm
'Statistical Non-Signiﬁcance in Empirical Economics'
- UCL staff | UCL students
IFS Conference RoomInstitute for Fiscal StudiesDrayton HouseLondonWC1H 0AXUnited Kingdom
About the Speaker
Professor of Economics at MIT
Alberto Abadie is an econometrician and empirical microeconomist, with broad disciplinary interests that span economics, political science and statistics.
Signiﬁcance tests are probably the most common form of inference in empirical economics, and signiﬁcance is often interpreted as providing greater informational content than non-signiﬁcance. In this article we show, however, that rejection of a point null often carries very little information, while failure to reject may be highly informative. This is particularly true in empirical contexts that are fairly common in economics, where data sets are large (and becoming larger) and where there are rarely reasons to put substantial prior probability on a point null. Our results challenge the usual practice of conferring point null rejections a higher level of scientiﬁc signiﬁcance than non-rejections. In consequence, we advocate a visible reporting and discussion of non-signiﬁcant results in empirical practice.