Statistical Non-Significance in Empirical Economics

17 Pages Posted: 12 Mar 2018 Last revised: 6 Mar 2023

See all articles by Alberto Abadie

Alberto Abadie

Harvard University - Harvard Kennedy School (HKS); National Bureau of Economic Research (NBER)

Date Written: March 2018

Abstract

Significance tests are probably the most common form of inference in empirical economics, and significance is often interpreted as providing greater informational content than non-significance. In this article we show, however, that rejection of a point null often carries very little information, while failure to reject may be highly informative. This is particularly true in empirical contexts that are typical and even prevalent in economics, where data sets are large (and becoming larger) and where there are rarely reasons to put substantial prior probability on a point null. Our results challenge the usual practice of conferring point null rejections a higher level of scientific significance than non-rejections. In consequence, we advocate a visible reporting and discussion of non-significant results in empirical practice.

Suggested Citation

Abadie, Alberto, Statistical Non-Significance in Empirical Economics (March 2018). NBER Working Paper No. w24403, Available at SSRN: https://ssrn.com/abstract=3138353

Alberto Abadie (Contact Author)

Harvard University - Harvard Kennedy School (HKS) ( email )

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National Bureau of Economic Research (NBER)

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