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date: 22 October 2018

Abstract and Keywords

Over the past decade, randomized field experiments have gained prominence in the toolbox of economics and policy making. Yet randomization enthusiasts have paid little attention to the ethical issues, economic costs, and theoretical difficulties caused by the so-called randomization principle. Randomized trials give placebos or no treatment at all to vulnerable individuals and withhold best treatments from the control group. Randomization has been proved to be less precise and less efficient than “Student’s” balanced alternatives—particularly when effect sizes and confounding from unobserved systematic effects are large. From medicine to economics, randomized trials are rarely if ever repeated. Using new evidence from a 25-question survey of randomization, statistical significance, and validity applied to articles using randomization techniques, the authors conclude that the most reliable ethical character of economics, Adam Smith’s “impartial spectator,” would not approve of randomized trials as practiced in economics and medicine.

Keywords: randomization, balance, ethics, Simpson’s paradox, field experiments, W. S. Gosset

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