Susan Athey on Machine Learning, Big Data, and Causation EconTalk Library of Economics and Liberty

And so, you want to give different treatment to those. And in classic econometrics you just kind of put everything in a regression, and the econometrics were the same--like, you'd put in a dummy variable for whether there was a higher minimum wage, and you would put in all these other covariates; but you'd use the same statistical analysis for both. And so I think the starting point for doing causal inference, which is mostly what we're interested in, in economics, is that you treat these things differently. So, I'm going to use machine learning methods, or sort of data mining techniques, to understand the effects of covariates, like, you know, all the characteristics of the patients; but I'm going to tell my model to do something different about the treatment effect. That's the variable I'm concerned about.