Defending Empirical Evidence

Let our journalists help you make sense of the noise: Subscribe to the Mother Jones Daily newsletter and get a recap of news that matters.


Matt Yglesias isn’t impressed with my post this morning showing that child tax subsidies don’t have much impact on fertility:

I buy it, but on another level I don’t buy it at all. This is just a chart showing that we’ve had sweeping waves of social and economic trends over the decades that totally swamp tweaks in the tax code. It’s true that you can put together a two-variable chart with appropriately-scaled axes to make it appear silly to say that the tax code is having an influence on fertility rates, but really the chart tells us nothing. We know that some people have children, and that different people have different numbers of children. We know that people exercise some level of conscious choice about this. And we know that having children is costly in both financial and non-financial ways. People also find it rewarding. But the costs are real and extra money to defray those costs should, at the margin, encourage people to have more children.

A few points:

  • In fairness, the study itself is a lot more than a “two-variable chart with appropriately-scaled axes.” That just happens to be the only part of the study that I included in my post.
  • In a sense, though, I agree with Matt: economists are endlessly clever at finding ways to prove that nothing ever has any effect. Design your model right and control for enough variables and pretty much anything can wash out if you really put your mind to it. These things should always be taken with a grain of salt until they get confirmed using a bunch of different approaches.
  • On the specific issue of child tax subsidies, of course there’s a lot of underlying stuff going on here. And unquestionably, a tax subsidy almost has to have some positive effect on fertility. But the size of the effect is really, really important. Far more important than the mere Econ 101 statement that people react to incentives at the margin. Sure they do. But if the incentive effect is so small that it’s swamped by everything else — which is what this study seems to show — then for all practical purposes there’s no effect. Alternatively, sometimes there are counteracting incentives that no one has thought about. The only way to find out is to dig into the evidence.

Contra Matt, empirical evidence is not “one of the most overrated things in policy debates.” It needs to be treated carefully, and it shouldn’t overwhelm common sense. But sometimes common sense is wrong, and sometime incentive effects, no matter how theoretically compelling, are small enough that they don’t really matter in the real world. That seems to be the case here.

In a nutshell: size matters. If I have one takeaway that I wish everyone would tattoo on their foreheads, that’s it. As usual, then: more evidence, please!

POSTSCRIPT: As always, it’s worth being conscious of your own confirmation biases. My intuition, for example, is that tax subsidies are unlikely to have much impact on decisions to have children. The benefits aren’t big enough, people don’t understand them very well, and other reasons for having (or not having) children are overwhelmingly more important. So naturally when I see a study that confirms this, I’m likely to believe it. Reihan Salam, who supports pro-natal policies in general, and Matt, who has more faith in theoretical constructs than I do, are more likely to be skeptical. Caveat emptor.

THE TRUTH IS...

what drives Mother Jones' team of 50-plus journalists. The truth is powerful, as evidenced by how hard those with something to hide, or profit to gain, seek to discredit it. The truth, stated boldly and reported meticulously, is what draws so many readers to Mother Jones.

And the truth is, going into the final 4 days of the year we still needed to raise $TK to hit our $350,000 goal and start 2021 on track. It's nerve-wracking, wondering if the big spike we normally see at the end of December is going to be another thing that doesn't go as planned in 2020, or worse, if, now that Donald Trump is set to leave the White House (for longer than a taxpayer-funded golf trip to a property he owns), folks might be pulling back from fighting for the truth and a democracy and think the hard work is done.

It's not, and if you can right now, please consider a year-end donation to support our team's fearless nonprofit journalism so we can close that big fundraising gap and finish the year strong, ready for all that's ahead in 2021. Whether you can give $5 or $500, it all matters in keeping us charging hard, and we'd be grateful.

payment methods

THE TRUTH IS...

what drives Mother Jones' team of 50-plus journalists. The truth is powerful, as evidenced by how hard those with something to hide, or profit to gain, seek to discredit it. The truth, stated boldly and reported meticulously, is what draws so many readers to Mother Jones.

And the truth is, going into the final 4 days of the year we still needed to raise $TK to hit our $350,000 goal and start 2021 on track. It's nerve-wracking, wondering if the big spike we normally see at the end of December is going to be another thing that doesn't go as planned in 2020, or worse, if, now that Donald Trump is set to leave the White House (for longer than a taxpayer-funded golf trip to a property he owns), folks might be pulling back from fighting for the truth and a democracy and think the hard work is done.

It's not, and if you can right now, please consider a year-end donation to support our team's fearless nonprofit journalism so we can close that big fundraising gap and finish the year strong, ready for all that's ahead in 2021. Whether you can give $5 or $500, it all matters in keeping us charging hard, and we'd be grateful.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate