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Risk management in the use of published statistical results for policy decisions

Duncan Ermini Leaf

arXiv 4 May 2023 · stat.OT

arXiv:2305.03205 · PDF · DOI · OpenAlex · Extracted main text

Abstract

Statistical inferential results generally come with a measure of reliability for decision-making purposes. For a policy implementer, the value of implementing published policy research depends critically upon this reliability. For a policy researcher, the value of policy implementation may depend weakly or not at all upon the policy's outcome. Some researchers might benefit from overstating the reliability of statistical results. Implementers may find it difficult or impossible to determine whether researchers are overstating reliability. This information asymmetry between researchers and implementers can lead to an adverse selection problem where, at best, the full benefits of a policy are not realized or, at worst, a policy is deemed too risky to implement at any scale. Researchers can remedy this by guaranteeing the policy outcome. Researchers can overcome their own risk aversion and wealth constraints by exchanging risks with other researchers or offering only partial insurance. The problem and remedy are illustrated using a confidence interval for the success probability of a binomial policy outcome.

Citation extraction

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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
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8Bordley, R. F (2014) Reference class forecasting: resolving its challenge to statistical modeling0.40511100%
9Degtiar, I. and Rose, S (2023) A review of generalizability and transportability0.40511100%
10Flyvbjerg, B (2008) Curbing optimism bias and strategic misrepresentation in planning: reference class forecasting in practice0.40511100%

Showing the top 10 of 20 scored citations.