### Recollections from the WCE conference at Stanford

On May 21, Kosuke Imai and I participated in a panel on Mediation, at the annual meeting of the West Coast Experiment Conference, organized by Stanford Graduate School of Business http://www.gsb.stanford.edu/

1.

We began the discussion by reviewing causal mediation analysis and summarizing the exchange we had on the pages of Psychological Methods (2014)

http://ftp.cs.ucla.edu/pub/

My slides for the panel can be viewed here:

http://web.cs.ucla.edu/~kaoru/

We ended with a consensus regarding the importance of causal mediation and the conditions for identifying of Natural Direct and Indirect Effects, from randomized as well as observational studies.

2.

We proceeded to discuss the symbiosis between the structural and the counterfactual languages. Here I focused on slides 4-6 (page 3), and remarked that only those who are willing to solve a toy problem from begining to end, using both potential outcomes and DAGs can understand the tradeoff between the two. Such a toy problem (and its solution) was presented in slide 5 (page 3) titled “Formulating a problem in Three Languages” and the questions that I asked the audience are still ringing in my ears. Please have a good look at these two sets of assumptions and ask yourself:

a. Have we forgotten any assumption?

b. Are these assumptions consistent?

c. Is any of the assumptions redundant (i.e. does it follow logically from the others)?

d. Do they have testable implications?

e. Do these assumptions permit the identification of causal effects?

f. Are these assumptions plausible in the context of the scenario given?

As I was discussing these questions over slide 5, the audience seemed to be in general agreement with the conclusion that, despite their logical equivalence, the graphical language enables us to answer these questions immediately while the potential outcome language remains silent on all.

I consider this example to be pivotal to the comparison of the two frameworks. I hope that questions a,b,c,d,e,f will be remembered, and speakers from both camps will be asked to address them squarely and explicitly .

The fact that graduate students made up the majority of the participants gives me the hope that questions a,b,c,d,e,f will finally receive the attention they deserve.

3.

As we discussed the virtues of graphs, I found it necessary to reiterate the observation that DAGs are more than just “natural and convenient way to express assumptions about causal structures” (Imbens and Rubin , 2013, p. 25). Praising their transparency while ignoring their inferential power misses the main role that graphs play in causal analysis. The power of graphs lies in computing complex implications of causal assumptions (i.e., the “science”) no matter in what language they are expressed. Typical implications are: conditional independencies among variables and counterfactuals, what covariates need be controlled to remove confounding or selection bias, whether effects can be identified, and more. These implications could, in principle, be derived from any equivalent representation of the causal assumption, not necessarily graphical, but not before incurring a prohibitive computational cost. See, for example, what happens when economists try to replace d-separation with graphoid axioms http://ftp.cs.ucla.edu/pub/

4.

Following the discussion of representations, we addressed questions posed to us by the audience, in particular, five questions submitted by Professor Jon Krosnick (Political Science, Stanford).

I summarize them in the following slide:

Krosnick’s Questions to Panel

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1) Do you think an experiment has any value without mediational analysis?

2) Is a separate study directly manipulating the mediator useful? How is the second study any different from the first one?

3) Imai’s correlated residuals test seems valuable for distinguishing fake from genuine mediation. Is that so? And how it is related to traditional mediational test?

4) Why isn’t it easy to test whether participants who show the largest increases in the posited mediator show the largest changes in the outcome?

5) Why is mediational analysis any “worse” than any other method of investigation?

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My answers focused on question 2, 4 and 5, which I summarize below:

2)

Q. Is a separate study directly manipulating the mediator useful?

Answer: Yes, it is useful if physically feasible but, still, it cannot give us an answer to the basic mediation question: “What percentage of the observed response is due to mediation?” The concept of mediation is necessarily counterfactual, i.e. sitting on the top layer of the causal hierarchy (see “Causality” chapter 1). It cannot be defined therefore in terms of population experiments, however clever. Mediation can be evaluated with the help of counterfactual assumptions such as “conditional ignorability” or “no interaction,” but these assumptions cannot be verified in population experiments.

4)

Q. Why isn’t it easy to test whether participants who show the largest increases in the posited mediator show the largest changes in the outcome?

Answer: Translating the question to counterfactual notation the test suggested requires the existence of monotonic function f_m such that, for every individual, we have Y_1 – Y_0 =f_m (M_1 – M_0)

This condition expresses a feature we expect to find in mediation, but it cannot be taken as a DEFINITION of mediation. This condition is essentially the way indirect effects are defined in the Principal Strata framework (Frangakis and Rubin, 2002) the deficiencies of which are well known. See http://ftp.cs.ucla.edu/pub/

In particular, imagine a switch S controlling two light bulbs L1 and L2. Positive correlation between L1 and L2 does not mean that L1 mediates between the switch and L2. Many examples of incompatibility are demonstrated in the paper above.

The conventional mediation tests (in the Baron and Kenny tradition) suffer from the same problem; they test features of mediation that are common in linear systems, but not the essence of mediation which is universal to all systems, linear and nonlinear, continuous as well as categorical variables.

5)

Q. Why is mediational analysis any “worse” than any other method of investigation?

Answer: The answer is closely related to the one given to question 3). Mediation is not a “method” but a property of the population which is defined counterfactually, and therefore requires counterfactual assumption for evaluation. Experiments are not sufficient; and in this sense mediation is “worse” than other properties under investigation, eg., causal effects, which can be estimated entirely from experiments.

About the only thing we can ascertain experimentally is whether the (controlled) direct effect differs from the total effect, but we cannot evaluate the extent of mediation.

Another way to appreciate why stronger assumptions are needed for mediation is to note that non-confoundedness is not the same as ignorability. For non-binary variables one can construct examples where X and Y are not confounded ( i.e., P(y|do(x))= P(y|x)) and yet they are not ignorable, (i.e., Y_x is not independent of X.) Mediation requires ignorability in addition to nonconfoundedness.

Summary

Overall, the panel was illuminating, primarily due to the active participation of curious students. It gave me good reasons to believe that Political Science is destined to become a bastion of modern causal analysis. I wish economists would follow suit, despite the hurdles they face in getting causal analysis to economics education.

http://ftp.cs.ucla.edu/pub/

http://ftp.cs.ucla.edu/pub/

Judea