Reassessing quasi-experiments: Policy evaluation, induction, and sutva

This article defends the use of quasi-experiments for causal estimation in economics against the widespread objection that quasi-experimental estimates lack external validity. The defence is that quasi-experimental replication of estimates can yield defeasible evidence for external validity. The article then develops a different objection. The stable unit treatment value assumption (SUTVA), on which quasi-experiments rely, is argued to be implausible due to the influence of social interaction effects on economic outcomes. A more plausible stable marginal unit treatment value assumption (SMUTVA) is proposed, but it is demonstrated to severely limit the usefulness of quasi-experiments for economic policy evaluation.