Essays on Causal Inference

You probably know the COVID-19 pandemic and the race between all the pharma companies to create a vaccine. There was a lot of talk about different phases of clinical trials and the effectiveness of various vaccines. In clinical trials, companies are trying to estimate the causal effect of giving a drug on patient’s health. Causal effect is the difference between what happened if the treatment was given and what would have happened if the treatment was not given ...

Let’s take a look at this chart. There is a perfect association between ice cream sales and shark attacks at the beach. When ice cream sales go up, shark attacks go up and when ice cream sales go down, shark attacks go down. If we were to take this association seriously, in order to lessen shark attacks for public safety, we would cut down on the number of ice cream shops at the beach. Of course, this would not work. The hidden story is that more people go to the beach in the summer and this increases both the probaility of a shark attack and ice cream sales. In order to attribute the effect of ice cream sales on shark attacks, we need to establish that the effect is because of the ice cream sales, not just associated with ice cream sales. ...

Going back to the red car example, how would we establish the causal effect of red colored car on accidents. In an ideal scenario, we select a random set of drivers and give them a red car to drive for x days and record the total number of accidents. We then go back in the time machine and give the exact set of drivers a grey car to driver and see if the accidents are less. This would give us a causal effect. But unfortunately, this is not possible. ...