Causal Inference when Observed and Unobserved Causes Interact

Abstract

When a cause interacts with unobserved factors to produce an effect, the contingency between the observed cause and effect cannot be taken at face value to infer causality. Yet, it would be computationally intractable to consider all possible unobserved, interacting factors. Nonetheless, two experiments found that when an unobserved cause is assumed to be fairly stable over time, people can learn about such interactions and adjust their inferences about the causal efficacy of the observed cause. When they observed a period in which a cause and effect were associated followed by a period of the opposite association, rather than concluding a complete lack of causality, subjects inferred an unobserved, interacting cause. The interaction explains why the overall contingency between the cause and effect is low and allows people to still conclude that the cause is efficacious.


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