Explaining Regression

by on May 3, 2005 at 7:12 am in Economics | Permalink

During his Daily Show appearance Steve Levitt said that in estimating the effect of abortion on crime he controlled for other variables like police and prisons.  Jon Stewart pressed Steve for an explanation of how someone could "control" for other variables – amazingly, Stewart seemed genuinely interested in an answer but, wisely, Steve demurred.  The exchange got me to thinking, What is the shortest, non-technical, yet reasonably accurate explanation of how this is done?

I think the way to go is to use the Frisch-Waugh-Lovell Theorem.  Here’s my attempt:

Suppose you want to figure out the effect of weight on life expectancy.  Heavy people tend to be tall so you have to control for height.  You can do this with a two-step procedure.  First, calculate how height correlates with weight.  Let’s say that you discover that every 1 inch increase in height above say 5’7 correlates with a 5 pound increase in weight; you now subtract from each person’s weight that portion which can be explained by height.  For example, you would subtract 5 pounds from everyone in the data of height 5’8 and 10 pounds from everyone who is 5’9.   Since height doesn’t explain weight perfectly, you are left with a new variable, weight2.  In the second step, you calculate how life expectancy correlates with weight2, since weight2 is "weight after controlling for height" you have now calculated the effect on life expectancy of weight after controlling for height.

To be clear, I am not suggesting that this is what Steve should have said!  (If asked I would have said, "Well, I could tell you that Jon, but then I would have to bore you.")  I’ve opened the comments section if you have some other ideas.

By the way the ubiquitous Steve Levitt will be here on Wednesday, but I repeat myself.

Bob Dobalina May 3, 2005 at 9:08 am

Perhaps you could ask Mr. Levitt to address the substantive criticisms of his shallow analysis of The Oakland A’s.

Thus far, he has succeeded only in making hay of straw men.

Aidan May 3, 2005 at 10:09 am

In trying to simplify something, you’ve made it more confusing. I think the most important thing is to drop the statistics speak altogether–no need to mention variables, correlations and “controlling.”
I’ve explained regression analysis to my math-phobic wife a couple of times and she now seems to understand. The way I do it is by saying something like this (using your weight example): It allows us to create two identical individuals who are alike in every way except for one characteristic, in this case weight. We then compare life expectancies and arrive at a reasonable estimation of the impact of individual weight. To be sure, I’ve glossed over some important facets, but the basic concept is still accessible to lay-people.

Bob: You should be more concerned about analyzing the A’s wins/losses than some economist’s take on their organizational structure. Just saying.

Nick May 3, 2005 at 11:17 am

I watched the first few minutes of the Daily Show interview, but turned it off after realizing that Levitt and the Daily Show format was not a good fit. (And I like the Daily Show.) Now, I realize I should have stuck it out.

Oh, well. The extra minutes of sleep I got meant I could spend a little more time reading more substantive analysis of Levitt’s work on the blogosphere.

Matt Newman May 3, 2005 at 11:52 am

I took it as a measure of Stewart’s interest that Levitt was on for two segments. Most guests are only on for one; it’s usually only the big names that merit two.

Aaron Morris May 3, 2005 at 1:01 pm

This is a problem we wrestle with often. We have to describe things for laypersons and legislators, but there simply isnt a synonym for ‘linear regression analysis’.

I personally think the description included (for free!) in Freakonomics is the best I have read. If you’ve read the book, it’s the one about the circuit boards. If you haven’t, its on page 163.

Cardinal Fang May 3, 2005 at 5:53 pm

But Levitt isn’t trying to prove that every single abortion reduced crime. He’s only trying (successfully, I think) to prove that in the aggregate, legalizing abortion had the effect of reducing crime. It could be that some significant number of abortions were of fetuses that would have grown up to murder people, but some small number of abortions were of fetuses that would have grown up to stop crimes. Nevertheless in that scenario, the abortions in toto would have ended up reducing crime.

So regression is the right statistical tool for the job.

Steve Sailer May 4, 2005 at 4:58 pm

Sorry to intrude, but Levitt’s abortion-cut-crime theory fails, catastrophically, most of the obvious tests of plausibility. For example, the first generation born after the legalization of abortion went on the worst teenage murder spree in American history. Similarly, the FBI’s annual survey of crime victims shows that the worst cohort for juvenile crime was the one born in the late 1970s. Moreover, groups that had the highest legal abortion rates (beginning in 1970 in NY and CA) had the earliest and worst run-ups in youth murder rates in the late 1980s and early 1990s.

Besides, Levitt’s simplistic model of how legalizing abortion is supposed to cut crime — by reducing unwanted births — is severely undermined by his own admission that following legalization, the birthrate declined only six percent but the number of pregnancies went up by almost 30%. In other words, legalizing abortion, according to Levitt, vastly increased the number of unwanted pregnancies. The actual effect on who got born therefore becomes much more uncertain.

You can read for yourself what the facts actually are at http://www.iSteve.com/abortion.htm

Randall Parker May 8, 2005 at 11:42 pm

Since I’ve been following medical research reports for decades what I’ve learned is that it is exceedingly difficult to control for variables in large population studies.

Look at the recent report claiming that mild to moderate obesity does not decrease life expectancy. Lots of studies have been done by generations of sharp medical researchers producing contrary results. Did it take decades to finally come up with a way to control for all the variables that could distort the results? Or will we find out a few years hence that the latest study is flawed?

Some economist confidently proclaims that he has picked the signal of abortion’s effects on crime against the background of countless other changes in society. Some other economists think that since this economist is so bright he must be right. Well, sorry, I’ve seen too many very bright medical researchers get things wrong after repeated attempts and I’ve seen the conventional wisdom swing back and forth too many times on other questions that had many more people working on them than this question of abortion and crime. It is at very least premature to proclaim that Levitt got it right.

I happen to think that Levitt is wrong for the reasons Steve Sailer has outlined. But even if Sailer hadn’t made his case I’d still be thinking:
But look at how complex the causes are for crime and how many other debates about crime and guns and crime and broken families have raged for decades without definitive answers. Social science is not that easy.

From what I’d call a scientific philosophical standpoint my problem with Levitt’s conclusion is that he doesn’t offer evidence that proves his vague mechanism. Attempts to control for variables have to do that because this isn’t real experimental science. This is “lets statistically control for variables without the ability to repeat experiments” science.

His mechanism: “Wantedness”? What social science evidence is there that “wantedness” has increased among the children being born? Also, what social science evidence is there that “wantedness” reduces the odds that a kid will grow up not to be a criminal?

An obvious detail about “wantedness” needs to be answered: “wantedness” by mothers or by fathers? Or both? Illegitimacy has been rising since abortion was legalized. So hasn’t paternal “wantedness” been declining substantially post Roe v Wade? His proposed mechanism seems highly dubious.

It is extremely difficult to control for variables when you don’t have evidence for mechanisms on how those variables might influence some target variable under study. Taking Alex’s example of height, under different circumstances with different populations height might be higher because of genetics, better nutrition, or even worse nutrition (high glycemic index diet causing higher average blood sugar causing higher insulin and higher IGF which might cause excess growth) or even use of growth hormones. A genetically heterogeneous population for height might have other genotypes on the same chromosome that also influence longevity independently even though they are linked to the height gene. Or greater height might be correlated with greater symmetry which might in turn be correlated to less toxin exposure and less stress during fetal development and hence tall people might be born with fewer internal flaws on average (though perhaps only in some environments). It is naive to attempt to control for variables without a lot of knowledge about how those variables influence each other and the phenomenon (in this case crime) under study.

æ°´æ— ç—• July 4, 2007 at 5:18 am
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