Is the Wide, Wide World of Economics Too Wide?

Is there anything economists won't study? Should there be?:

Is an Economist Qualified To Solve Puzzle of Autism?, by Mark Whitehouse, WSJ: In the spring of 2005, Cornell University economist Michael Waldman noticed a strange correlation in Washington, Oregon and California. The more it rained or snowed, the more likely children were to be diagnosed with autism. ...

[This] soon led Prof. Waldman to conclude that something children do more during rain or snow -- perhaps watching television -- must influence autism. Last October, Cornell announced the resulting paper in a news release headlined, "Early childhood TV viewing may trigger autism, data analysis suggests."

Prof. Waldman's willingness to hazard an opinion on a delicate matter of science reflects the growing ambition of economists -- and also their growing hubris, in the view of critics. Academic economists are increasingly venturing beyond their traditional stomping ground, a wanderlust that has produced some powerful results but also has raised concerns about whether they're sometimes going too far. ...

Such debates are likely to grow as economists delve into issues in education, politics, history and even epidemiology. Prof. Waldman's use of precipitation illustrates one of the tools that has emboldened them: the instrumental variable, a statistical method that, by introducing some random or natural influence, helps economists sort out questions of cause and effect. Using the technique, they can create "natural experiments" that seek to approximate the rigor of randomized trials -- the traditional gold standard of ... research. ...

But as enthusiasm for the approach has grown, so too have questions. One concern: When economists use one variable as a proxy for another -- rainfall patterns instead of TV viewing, for example -- it's not always clear what the results actually measure. Also, the experiments on their own offer little insight into why one thing affects another.

"There's a saying that ignorance is bliss," says James Heckman ... at the University of Chicago who won a Nobel Prize in 2000... "I think that characterizes a lot of the enthusiasm for these instruments." Says MIT economist Jerry Hausman, "If your instruments aren't perfect, you could go seriously wrong." ...

In principle, the best way to figure out whether television triggers autism would be to do what medical researchers do: randomly select a group of susceptible babies at birth to refrain from television, then compare their autism rate to a similar control group that watched normal amounts of TV. If the abstaining group proved less likely to develop autism, that would point to TV as a culprit.

Economists usually ...[cannot] perform that kind of experiment. ... Instead, economists look for instruments -- natural forces or government policies that do the random selection for them. First developed in the 1920s, the technique helps them separate cause and effect. Establishing whether A causes B can be difficult, because often it could go either way. If television watching were shown to be unusually prevalent among autistic children, it could mean either that television makes them autistic or that something about being autistic makes them more interested in TV. ...

Prof. Waldman and his colleagues had such [techniques]... in mind when they approached autism and TV. By putting together weather data and government time-use studies, they found that children tended to spend more time in front of the television when it rained or snowed. Precipitation became the group's instrumental variable, because it randomly selected some children to watch more TV than others.

The researchers looked at detailed precipitation and autism data from Washington, Oregon and California -- states where rain and snowfall tend to vary a lot. They found that children who grew up during periods of unusually high precipitation proved more likely to be diagnosed with autism. A second instrument for TV-watching, the percentage of households that subscribe to cable, produced a similar result. Prof. Waldman's group concluded that TV-watching could be a cause of autism.

Criticism quickly arose, illustrating some of the perils of the economists' approach. For one, instruments are often too blunt. As Prof. Waldman concedes, precipitation could be linked to a lot of factors other than TV-watching -- such as household mold -- that could be imagined to trigger autism. ... "It is just too much of a stretch to tie this to television-watching," says Joseph Piven, director of the Neurodevelopmental Disorders Research Center at the University of North Carolina. "Why not tie it to carrying umbrellas?"

Also, Prof. Waldman's findings do nothing to explain the mechanism by which television would influence autism, a gap that instrumental variables are inherently unable to fill. That's one reason many autism researchers think he shouldn't have publicized his results or made recommendations to parents. "I think this is irresponsible," says Dr. Klin of Yale. "We should not provide clinical advice unless there is scientific evidence to substantiate it." ...

David Card, a professor at the University of California, Berkeley, who has done influential work on the minimum wage, fears that the fascination with the instrumental-variables technique "leads to interest in topics that economists are not particularly well-trained to study."

Those who favor the method say it's just one tool among many -- all of which have flaws -- and is intended to help fill in the picture. ... Prof. Waldman welcomes the scrutiny, saying he hopes his work will also provoke autism researchers to conduct clinical trials. "Obviously this is an unusual thing for an economist to be looking at," says Prof. Waldman. "Maybe I was overconfident. We'll see."