IDEAS home Printed from https://ideas.repec.org/a/bla/ausecr/v58y2025i3p251-258.html

The Case for Randomised Trials (and Why Big Data Does Not Supersede Randomisation)

Author

Listed:
  • Andrew Leigh

Abstract

Research Question/Issue With the growing availability of large‐scale datasets, is randomisation still necessary for identifying causal impacts? Research Findings/Insights Randomised trials, by using luck to assign participants to treatment and control groups, reliably provide a credible counterfactual that ensures observed differences reflect causal impacts. In contrast, observational data often produces misleading correlations that fail to replicate under experimental conditions. Therefore, the increased availability of big data does not make randomisation obsolete. Practitioner/Policy Implications I propose five approaches to increase the quality and quantity of randomised policy trials: encourage curiosity in yourself and those you lead; seek simple trials, especially at the outset; ensure experiments are ethically grounded; foster institutions that push people towards more rigorous evaluation; and collaborate internationally to share best practice and identify evidence gaps. Methods Used This paper employs a qualitative synthesis of historical and contemporary examples, illustrating the superiority of randomised trials over purely observational methods. By drawing comparisons across disciplines—economics, health, and social policy—it highlights how nonexperimental approaches can fall short and explores how big data can be a complement to rigorous randomised trials.

Suggested Citation

  • Andrew Leigh, 2025. "The Case for Randomised Trials (and Why Big Data Does Not Supersede Randomisation)," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 58(3), pages 251-258, September.
  • Handle: RePEc:bla:ausecr:v:58:y:2025:i:3:p:251-258
    DOI: 10.1111/1467-8462.70003
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/1467-8462.70003
    Download Restriction: no

    File URL: https://libkey.io/10.1111/1467-8462.70003?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. John A. List, 2024. "Field Experiments: Here Today Gone Tomorrow?," The American Economist, Sage Publications, vol. 69(2), pages 214-234, October.
    2. Jon Baron, 2018. "A Brief History of Evidence-Based Policy," The ANNALS of the American Academy of Political and Social Science, , vol. 678(1), pages 40-50, July.
    3. Abhijit Vinayak Banerjee, 2020. "Field Experiments and the Practice of Economics," American Economic Review, American Economic Association, vol. 110(7), pages 1937-1951, July.
    4. Altmann, Steffen & Falk, Armin & Jäger, Simon & Zimmermann, Florian, 2018. "Learning about job search: A field experiment with job seekers in Germany," Journal of Public Economics, Elsevier, vol. 164(C), pages 33-49.
    5. Francisco J. Buera & Joseph P. Kaboski & Robert M. Townsend, 2023. "From Micro to Macro Development," Journal of Economic Literature, American Economic Association, vol. 61(2), pages 471-503, June.
    6. Stefano DellaVigna & Woojin Kim & Elizabeth Linos, 2024. "Bottlenecks for Evidence Adoption," Journal of Political Economy, University of Chicago Press, vol. 132(8), pages 2748-2789.
    7. Karthik Muralidharan & Paul Niehaus & Sandip Sukhtankar, 2025. "Identity Verification Standards in Welfare Programs: Experimental Evidence from India," The Review of Economics and Statistics, MIT Press, vol. 107(2), pages 372-392, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Libman, A., 2024. ""Zoo" of empirical results: Quantitative research and accumulation of knowledge in social sciences," Journal of the New Economic Association, New Economic Association, vol. 65(4), pages 178-194.
    2. Conny Wunsch & Felix Rochlitz & Patrick Arni, 2025. "Jobseekers’ skills and job search behaviour," Swiss Journal of Economics and Statistics, Springer;Swiss Society of Economics and Statistics, vol. 161(1), pages 1-31, December.
    3. Cairo, Sofie & Mahlstedt, Robert, 2021. "Transparency of the Welfare System and Labor Market Outcomes of Unemployed Workers," IZA Discussion Papers 14940, IZA Network @ LISER.
    4. Sascha Drahs & Luke Haywood & Amelie Schiprowski, 2018. "Job Search with Subjective Wage Expectations," Discussion Papers of DIW Berlin 1725, DIW Berlin, German Institute for Economic Research.
    5. Girum Abebe & A Stefano Caria & Marcel Fafchamps & Paolo Falco & Simon Franklin & Simon Quinn, 2021. "Anonymity or Distance? Job Search and Labour Market Exclusion in a Growing African City [Endogenous Stratification in Randomized Experiments]," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 88(3), pages 1279-1310.
    6. Ken-ichi Hashimoto & Ryonghun Im & Takuma Kunieda & Akihisa Shibata, 2025. "Relative Risk Aversion and Business Fluctuations," ISER Discussion Paper 1272, Institute of Social and Economic Research, The University of Osaka.
    7. Banerjee, Abhijit V. & Chiplunkar, Gaurav, 2024. "How important are matching frictions in the labor market? Experimental & non-experimental evidence from a large Indian firm," Journal of Development Economics, Elsevier, vol. 171(C).
    8. Cho, Yoon Y. & Lee, Soohyung, 2021. "How to Improve Worker-Firm Matching: Evidence from a Temporary Foreign Worker Market," IZA Discussion Papers 14328, IZA Network @ LISER.
    9. Huang, Qing & Xie, Victoria Wenxin & You, Wei, 2026. "Do resource rents drive urbanization and structural transformation? A global analysis," Journal of Development Economics, Elsevier, vol. 180(C).
    10. Elisa Guglielminetti & Rafael Lalive & Philippe Ruh & Etienne Wasmer, 2015. "Spatial search strategies of job seekers and the role of unemployment insurance," SciencePo Working papers hal-03393225, HAL.
    11. Mengchen Dong & Jean-François Bonnefon & Iyad Rahwan, 2025. "Heterogeneous preferences and asymmetric insights for AI use among welfare claimants and non-claimants," Nature Communications, Nature, vol. 16(1), pages 1-11, December.
    12. Tianshu Sun & Zhe Yuan & Chunxiao Li & Kaifu Zhang & Jun Xu, 2024. "The Value of Personal Data in Internet Commerce: A High-Stakes Field Experiment on Data Regulation Policy," Management Science, INFORMS, vol. 70(4), pages 2645-2660, April.
    13. Cairo, Sofie & Mahlstedt, Robert, 2023. "The disparate effects of information provision: A field experiment on the work incentives of social welfare," Journal of Public Economics, Elsevier, vol. 226(C).
    14. Guido W. Imbens, 2022. "Causality in Econometrics: Choice vs Chance," Econometrica, Econometric Society, vol. 90(6), pages 2541-2566, November.
    15. Ma, Xiao & Muendler, Marc-Andreas & Nakab, Alejandro, 2020. "Learning by Exporting and Wage Profiles: New Evidence from Brazil," MPRA Paper 109497, University Library of Munich, Germany, revised 31 Aug 2021.
    16. Michèle Belot & Philipp Kircher & Paul Muller, 2019. "Providing Advice to Jobseekers at Low Cost: An Experimental Study on Online Advice," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 86(4), pages 1411-1447.
    17. repec:osf:osfxxx:2fjev_v1 is not listed on IDEAS
    18. Strzałkowski, Andrzej, 2024. "Adaptation and operationalisation of sustainable degrowth for policy: Why we need to translate research papers into legislative drafts?," Ecological Economics, Elsevier, vol. 220(C).
    19. Ingar Haaland & Christopher Roth & Johannes Wohlfart, 2023. "Designing Information Provision Experiments," Journal of Economic Literature, American Economic Association, vol. 61(1), pages 3-40, March.
    20. Pei-Hsuan Tsai & Chih-Jou Chen & Jia-Wei Tang, 2021. "Key Factors Influencing Talent Retention and Turnover in Convenience Stores: A Comparison of Managers’ and Employees’ Perspectives," SAGE Open, , vol. 11(4), pages 21582440211, December.
    21. Bharadwaj, Preethika & Innocenti, Stefania, 2026. "Securing public support for fuel subsidy reform: Experimental and policymaker insights from Malaysia," Energy Economics, Elsevier, vol. 153(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ausecr:v:58:y:2025:i:3:p:251-258. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/mimelau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.