Causation, counterfactuals and competitive advantage

Causation is still poorly understood in strategy research, and confusion prevails around key concepts such as competitive advantage. In this paper, we define epistemological conditions that help to dispel some of this confusion and to provide a basis for more developed approaches. In particular, we argue that a counterfactual approach – that builds on a systematic analysis of ‘what-if’ questions – can advance our understanding of key causal mechanisms in strategy research. We offer two concrete methodologies – counterfactual history and causal modeling – as useful solutions. We also show that these methodologies open up new avenues in research on competitive advantage. Counterfactual history can add to our understanding of the context-specific construction of resource-based competitive advantage and path dependence, and causal modeling can help to reconceptualize the relationships between resources and performance. In particular, resource properties can be regarded as mediating mechanisms in these causal relationships.

Causation, counterfactuals and competitive advantage

Causation is still poorly understood in strategy research, and confusion prevails around key concepts such as competitive advantage. In this paper, we define epistemological conditions that help to dispel some of this confusion and to provide a basis for more developed approaches. In particular, we argue that a counterfactual approach – that builds on a systematic analysis of ‘what-if’ questions – can advance our understanding of key causal mechanisms in strategy research. We offer two concrete methodologies – counterfactual history and causal modeling – as useful solutions. We also show that these methodologies open up new avenues in research on competitive advantage. Counterfactual history can add to our understanding of the context-specific construction of resource-based competitive advantage and path dependence, and causal modeling can help to reconceptualize the relationships between resources and performance. In particular, resource properties can be regarded as mediating mechanisms in these causal relationships.

Strategic Votes and Sincere Counterfactuals

The Random Utility Model (RUM) of voting behavior can account for strategic voting by making use of proxy indicators that measure voter incentives to vote strategically. The contribution of this paper is to propose a new method to estimate the RUM in the presence of strategic voters, without having to construct proxy measures of strategic voting incentives. Our method can be used to infer the counterfactual sincere vote of those who vote strategically and provides an estimate of the size of strategic voting. We illustrate the procedure using post-electoral survey data from Spain. Our calculations indicate that strategic voting in Spain is about 2.19 per cent

Counterfactuals and causal inference: Methods and principles for social research

"Most quantitative empirical analyses are motivated by the desire to estimate the causal effect of an independent variable on a dependent variable. Although the randomized experiment is the most powerful design for this task, in most social science research done outside of psychology, experimental designs are infeasible. (Winship & Morgan, 1999, p. 659)." This quote from earlier work by Winship and Morgan, which was instrumental in setting the groundwork for their book, captures the essence of our review of Morgan and Winship's book: It is about causality in nonexperimental settings.

Lewis’ Theory of Counterfactuals and Essentialism

La logique contemporaine a connu de nombreux développements au cours de la seconde moitié du siècle dernier. Le plus sensationnel est celui de la logique modale et de sa sémantique des mondes possibles (SMP) dû à Saul Kripke dans les années soixante. Ces dans ce cadre que David Lewis exposera sa sémantique des contrefactuels (SCF). Celle-ci constitue une véritable excroissance de l’architecture kripkéenne. Mais sur quoi finalement repose l’architecture kripkéenne elle-même ? Il semble bien que la réponse soit celle d’une ontologie raffinée ultimement basée sur la notion de mondes possible. Ce mémoire comporte quatre objectifs. Dans un premier temps, nous allons étudier ce qui distingue les contrefactuels des autres conditionnels et faire un survol historique de la littérature concernant les contrefactuels et leur application dans différent champs du savoir comme la philosophie des sciences et l’informatique. Dans un deuxième temps, nous ferons un exposé systématique de la théorie de Lewis telle qu’elle est exposée dans son ouvrage Counterfactuals. Finalement, nous allons explorer la fondation métaphysique des mondes possible de David Lewis dans son conception de Réalisme Modal.

Examining moderators of the hindsight bias in the context of civil legal decision -making: Counterfactuals, causal proximity, and self -referencing

The current research sought to clarify the diverging relationships between counterfactual thinking and hindsight bias observed in the literature thus far. In a non-legal context, Roese and Olson (1996) found a positive relationship between counterfactuals and hindsight bias, such that counterfactual mutations that undid the outcome also increased participants’ ratings of the outcome’s a priori likelihood. Further, they determined that this relationship is mediated by causal attributions about the counterfactually mutated antecedent event. Conversely, in the context of a civil lawsuit, Robbennolt and Sobus (1997) found that the relationship between counterfactual thinking and hindsight bias is negative. The current research sought to resolve the conflicting findings in the literature within a legal context. ^ In Experiment One, the manipulation of the normality of the defendant’s target behavior, designed to manipulate participants’ counterfactual thoughts about said behavior, did moderate the hindsight effect of outcome knowledge on mock jurors’ judgments of the foreseeability of that outcome as well as their negligence verdicts. Although I predicted that counterfactual thinking would increase, or exacerbate, the hindsight bias, as found by Roese and Olson (1996), my results provided some support for Robbenolt and Sobus’s (1997) finding that counterfactual thinking decreases the hindsight bias. Behavior normality did not moderate the hindsight effect of outcome knowledge in Experiment Two, nor did causal proximity in Experiment Three. ^ Additionally, my hypothesis that self-referencing may be an effective hindsight debiasing technique received little support across the three experiments. Although both the self-referencing instructions and self-report measure consistently decreased mock jurors’ likelihood of finding the defendant negligent, and self-referencing instructions decreased their foreseeability ratings in studies two and three, the self-referencing manipulation did not interact with outcome knowledge to moderate a hindsight bias effect on either foreseeability or negligence judgments. The consistent pattern of results across the three experiments, however, suggests that self-referencing may be an effective technique in reducing the likelihood of negligence verdicts.^

Examining Moderators of the Hindsight Bias in the Context of Civil Legal Decision-Making: Counterfactuals, Causal Proximity, and Self-Referencing

The current research sought to clarify the diverging relationships between counterfactual thinking and hindsight bias observed in the literature thus far. In a non-legal context, Roese and Olson (1996) found a positive relationship between counterfactuals and hindsight bias, such that counterfactual mutations that undid the outcome also increased participants’ ratings of the outcome’s a priori likelihood. Further, they determined that this relationship is mediated by causal attributions about the counterfactually mutated antecedent event. Conversely, in the context of a civil lawsuit, Robbennolt and Sobus (1997) found that the relationship between counterfactual thinking and hindsight bias is negative. The current research sought to resolve the conflicting findings in the literature within a legal context. In Experiment One, the manipulation of the normality of the defendant’s target behavior, designed to manipulate participants’ counterfactual thoughts about said behavior, did moderate the hindsight effect of outcome knowledge on mock jurors’ judgments of the foreseeability of that outcome as well as their negligence verdicts. Although I predicted that counterfactual thinking would increase, or exacerbate, the hindsight bias, as found by Roese and Olson (1996), my results provided some support for Robbenolt and Sobus’s (1997) finding that counterfactual thinking decreases the hindsight bias. Behavior normality did not moderate the hindsight effect of outcome knowledge in Experiment Two, nor did causal proximity in Experiment Three. Additionally, my hypothesis that self-referencing may be an effective hindsight debiasing technique received little support across the three experiments. Although both the self-referencing instructions and self-report measure consistently decreased mock jurors’ likelihood of finding the defendant negligent, and self-referencing instructions decreased their foreseeability ratings in studies two and three, the self-referencing manipulation did not interact with outcome knowledge to moderate a hindsight bias effect on either foreseeability or negligence judgments. The consistent pattern of results across the three experiments, however, suggests that self-referencing may be an effective technique in reducing the likelihood of negligence verdicts.

Encouraging children to think counterfactually enhances blocking in a causal learning task

According to a higher order reasoning account, inferential reasoning processes underpin the widely observed cue competition effect of blocking in causal learning. The inference required for blocking has been described as modus tollens (if p then q, not q therefore not p). Young children are known to have difficulties with this type of inference, but research with adults suggests that this inference is easier if participants think counterfactually. In this study, 100 children (51 five-year-olds and 49 six- to seven-year-olds) were assigned to two types of pretraining groups. The counterfactual group observed demonstrations of cues paired with outcomes and answered questions about what the outcome would have been if the causal status of cues had been different, whereas the factual group answered factual questions about the same demonstrations. Children then completed a causal learning task. Counterfactual pretraining enhanced levels of blocking as well as modus tollens reasoning but only for the younger children. These findings provide new evidence for an important role for inferential reasoning in causal learning.

Imagination et perception morale

Dans cette thèse en psychologie morale, je m’intéresse au rôle de l’imagination dans la perception morale. Je soutiens que l’imagination y a une fonction épistémique dans la mesure où – en s’accompagnant ou non d’émotions – elle nous révèle des normes, des valeurs ou des vertus morales qui seraient autrement passées inaperçues. En simulant des croyances et des perceptions, l’imagination nous permet d’accéder à ces caractéristiques d’une situation moralement pertinentes, mais perceptuellement non saillantes. J’identifie trois modes de « perception morale imaginative » : 1) la prise de perspective qui consiste à endosser le point de vue d’autrui, 2) le cadrage imaginatif qui désigne le fait de voir un élément d’une situation comme autre qu’il n’est et, 3) la comparaison imaginative qui, grâce à la pensée contrefactuelle, éclaire le monde actuel à partir d’un monde possible imaginé. Chacun de ces modes contribue à enrichir notre connaissance morale, et partant, à améliorer notre délibération morale. J’appuie ma démonstration sur des travaux récents en philosophie de la psychologie, en psychologie cognitive et sociale, en neuropsychologie et, bien évidemment, en psychologie morale.

The National Audit Office uses OR to assess the value for money of public services

Supreme audit institutions (SAIs) have an important role in assessing value for money in the delivery of public services. Assessing value for money necessarily involves assessing counterfactuals: good value for money has been achieved if a policy could not reasonably have been delivered more efficiently, effectively, or economically. Operations research modelling has the potential to help in the assessment of these counterfactuals. However, is such modelling too arcane, complex, and technically burdensome for organisations that, like SAIs, operate in a time- and resource-constrained and politically charged environment? We report on three applications of modelling at the UK's SAI, the National Audit Office, in the context of studies on demand management in tax collection, end-of-life care, and health-care associated infections. In all cases, the models have featured in the audit reports and helped study teams come to a value-for-money judgment. We conclude that OR modelling is indeed a valuable addition to the value-for-money auditor's methodological tool box.

Partially identified treatment effects under imperfect compliance: the case of domestic violence

The Minneapolis Domestic Violence Experiment (MDVE) is a randomized social experiment with imperfect compliance which has been extremely influential in how police officers respond to misdemeanor domestic violence. This paper re-examines data from the MDVE, using recent literature on partial identification to find recidivism associated with a policy that arrests misdemeanor domestic violence suspects rather than not arresting them. Using partially identified bounds on the average treatment effect I find that arresting rather than not arresting suspects can potentially reduce recidivism by more than two-and-a-half times the corresponding intent-to-treat estimate and more than two times the corresponding local average treatment effect, even when making minimal assumptions on counterfactuals.