Causality and counterfactuals

The counterfactual model is one of the most commonly used theories for
causality in social sciences. The idea of the counterfactual model is that there are two potential outcome for an individual. For example, in an experiment, an individual can be assigned either to receive a treatment or to be in the control group that does not receive a treatment. However, because an individual can be assigned to just one group, only one of these potential outcomes is observed and the other one, called the counterfactual outcome, is not. The model defines the causal effect as the difference between these two outcomes. For example, in the case of experiments, the causal effect on an individual level is defined as the difference after the treatment and the counterfactual case had the person not received the treatment.

[tranang]

I have a question as follows and the answer is c). Can you please help to explain why?

The Spanish Army used to have a 2-year forced-conscription military service at 21 years of age. Because each year there were more conscripts that were needed, recruits could apply for military service exemption. Not surprisingly, there used to be more applications for exemptions than exemptions available, and the army used to make a lottery to randomly choose which applicants were awarded the exemption (and which applicants were forced to serve). A comparison of the earnings of exempted applicants and unsuccessful applicants some years after the service would allow us to evaluate:
a) The average earnings effect of serving in the army.
b) The average earnings effect of serving in the army for those who served
c) The average earnings effect of serving in the army for those who did not serve

[ahmedmcfc]

You saved me for my Quantitive Theory Methods exam. Thanks!

[cracrul]

Thank you, Professor Mikko.
How can we build an operational definition of causality to approach SEM models in research in the social sciences?

[gongxiaoli]

Thank you! Great job. I now understand counterfactual.

[varunadreepaul]

Thanks..how do we go for the regression plz

[alvarorodriguezrojas]

With “characteristic” you mean “the effects of treatment”? Thanks in advance!