Editorial—It’s the Findings, Stupid, Not the Assumptions

Abstract

Observing reality is especially valuable. However, without models, every situation at every time on every variable would be unpredictable. Assumptions allow models and theories to assert constancy. Assumptions distill and simplify reality by dismissing the conspicuous but irrelevant. Criticizing assumptions as unrealistic is absurd. Abstraction is the precise virtue of an assumption. For example, seldom are we prisoners facing interrogation, yet the prisoner’s dilemma remains relevant. The adage “A bird in the hand is worth two in the bush” is relevant for more than birds. Unrealistic assumptions that deny current beliefs breed great new theories. Assumptions are analogous to the basic ingredients in a gourmet recipe. Only the final product of the recipe dictates whether the ingredients suffice. Similarly, assumptions are realistic when they produce good theories, satisfactory predictions, valuable implications, and correct recommendations. Output matters far more than input. Realism is only an issue when creatively diagnosing poorly performing models, not when judging model performance. Assumptions are the source of value in empirical analyses. If data sets were truly the source of value, empirical research studies would only greatly devalue the raw data by dramatically reducing rich observations to a few meager summary statistics or estimated parameters. Most empirical research makes a contribution by ignoring (assuming away) most information in the data. We must dramatically shift our attention far away from the hopeless pursuit and sophistry of realistic assumptions to the contribution those assumptions produce. There are scientific methods for evaluating model output (i.e., predictions, findings, implications, recommendation) on criteria such as accuracy, reliability, validity, robustness, and so on. No corresponding objective scientific methods exist for evaluating realism. Realism depends only on personal taste.

Commentary—Relevancy Is Robust Prediction, Not Alleged Realism

“…This comment clarifies questions raised about Shugan (2007a) and briefly elaborates on the evidence supporting his arguments.…”

“…Friedman (1953) diminishes the importance of seemingly realistic assumptions. Shugan (2007a) only argues that realism is an inappropriate criterion for evaluating assumptions because of its inherent subjectivity (compared with more objective metrics of predictive accuracy) and inherent ambiguity without the context of a theory. Assumptions need only hold in the region and extent required by the theory.…”

“…Introduction Shugan (2007a) argues that judgments concerning research should stress objective evaluations rather than the tastes of reviewers or the popularity of particular assumptions. He advocates greater emphasis on objective evaluations such as the accuracy and reliability of predictions rather than subjective evaluations based on realism.…”

“…As evidence, Shugan (2007a) provides many examples of great theories initially rejected because their assumptions appeared unrealistic. In fact, this is the norm rather than the exception.…”

“…Shugan (2007a) does not attempt to argue that one research objective is better than another. In fact, Shugan (2007a, p. 454) states, "If assumptions produce a model, theory, method, or conceptualization that achieves the desired objective, then we should consider the corresponding assumptions to be realistic."…”