Causal evidence from random assignment has been labeled "the most credible." We argue itis generally incomplete in finance/economics, omitting central parts of the true empirical causalchain. Random assignment, in eliminating self-selection, simultaneously precludes signaling viatreatment...

We incorporate structural modellers into the economy they model. Using the traditional moment-matching method, they ignore policy feedback and estimate parameters using a structural model that treats policy changes as zero probability (or exogenous) "counterfactuals." Estimation bias occurs...