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One strategy for discovering the connections
between social policy interventions and behavioral outcomes
is to conduct social experiments that use random assignment
research designs. Although random assignment experiments provide
reliable estimates of the effects of a particular policy,
they do not reveal how a policy brings about its effects.
If policymakers had answers to the “how” questions, they could
design more effective interventions and make more informed
policy trade-offs. This paper reviews one promising approach
to specifying the causal paths by which impacts are expected
to occur: instrumental variables analysis, a method of estimating
the effects of intervening variables — also called mediating
variables, or mediators — that link interventions and outcomes.
It explores the feasibility of applying this approach to data
from random assignment designs, reviews the policy questions
that can be answered using the approach, and outlines the
conditions that have to be met for the effects of mediating
variables to be estimated. Illustrations of instrumental variables
analysis based on data from random assignment studies are
also presented.
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