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Empirical L&D decision-threshold study of randomized NSW training evidence with bootstrap and permutation robustness.

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Decision Value of Training Evidence: Reanalysis of the National Supported Work Experiment

CI Empirical rebuild

Empirical Study · Learning & Development Research · Training Evaluation / Decision Analysis / Experimental Evidence

Training evaluation often stops at a binary question: did the intervention have a positive effect? This study adds a second decision layer: how demanding can a minimum-benefit requirement become before the evidence stops clearing it consistently? Using the Dehejia–Wahba RE74 subset of the randomized National Supported Work experiment, the analysis separates the historical treatment effect from uncertainty and from the threshold scenarios used to interpret it.

That separation matters for L&D. The experiment provides a historical causal contrast for this randomized subset, while the threshold frontier shows how the same evidence behaves under increasingly demanding illustrative benefit requirements. The thresholds are deliberately not presented as program cost, current-dollar ROI, or a universal adoption rule.

Study architecture

At a glance

Evidence item Result
Randomized controls 260
Treated participants 185
Treated − control mean RE78 1,794.34
Large-sample 95% interval 479.19 to 3,109.50
Bootstrap 95% interval 519.04 to 3,117.80
Bootstrap effect above zero 0.9978
50% exceedance frontier 1,700
Exceedance above 2,000 0.3818
Label-permutation diagnostic p = 0.005899

All monetary values are historical 1982 U.S. dollars as defined in the source documentation.

Research question

How does the interpretation of randomized training evidence change as an illustrative minimum economically meaningful earnings gain becomes more demanding?

Source and sample

The source page identifies this as a further subset of LaLonde's National Supported Work experimental sample containing RE74 information:

  • 185 treated observations
  • 260 randomized controls
  • 10 columns in each row
  • variables: treatment, age, education, Black, Hispanic, married, nodegree, RE74, RE75, RE78
  • RE78 is the outcome

Published Dehejia–Wahba documentation describes RE78 as real 1978 earnings expressed in 1982 U.S. dollars.

This repository therefore does not treat the dollar values as current purchasing power or as modern corporate L&D benefit values.

Pinned source files

File Rows SHA-256
control 260 a1364cea459d953dc691a667d99194b4ad335d6d550354fe23a5d2dc58d729b5
treated 185 e7b742fe0ff07a0f45e129b4ff108bb9611cd83d53604732c48a8a0a3e20eda3

The raw participant files are downloaded only during reproducibility runs and are not redistributed in this repository.

Hypotheses

  1. H1: the treated group has higher mean RE78 than the randomized control group in this experimental subset.
  2. H2: uncertainty around the treated-minus-control difference is material relative to increasingly demanding minimum-benefit scenarios.
  3. H3: bootstrap exceedance fractions decline monotonically as the illustrative threshold rises.

These hypotheses concern this historical experimental subset and the repository's decision-threshold operationalization. They do not establish modern corporate training ROI.

Method

The analysis reports four layers:

  1. Observed experimental contrast: treated minus control mean RE78.
  2. Large-sample uncertainty: Welch standard error and a 95% normal interval.
  3. Resampling uncertainty: seeded 5,000-resample nonparametric bootstrap and percentile interval.
  4. Experimental-design robustness diagnostic: seeded 10,000 treatment-label permutations under exchangeability.

The permutation result is a robustness diagnostic. It is not presented as exact reconstruction of the original NSW randomization procedure.

Method

Main empirical results

Metric Result
Control mean RE78 4,554.80
Treated mean RE78 6,349.14
Treated − control 1,794.34
Welch standard error 671.00
Large-sample 95% interval 479.19 to 3,109.50
Bootstrap 95% percentile interval 519.04 to 3,117.80
Bootstrap fraction above zero 0.9978
Bootstrap fraction above 2,000 0.3818
Two-sided label-permutation diagnostic p 0.005899

All monetary values in the table are historical 1982 U.S. dollars as defined in the source literature.

Dense decision-threshold frontier

The released frontier spans 0 to 4,000 in 100-dollar increments. For every threshold it reports:

  • the observed point-estimate headroom: effect minus threshold;
  • the fraction of bootstrap resamples whose treatment difference exceeds that threshold.

Selected diagnostics:

  • bootstrap exceedance remains at least 0.95 through a threshold of 700
  • at least 0.80 through 1,200
  • at least 0.50 through 1,700
  • at least 0.20 through 2,300
  • at least 0.05 through 2,900

These are resampling frontier diagnostics, not posterior probabilities of implementation success.

Decision-threshold evidence summary

Why the thresholds are illustrative

The repository does not contain:

  • observed NSW program delivery cost per participant;
  • a corporate L&D implementation budget;
  • a validated modern break-even rule;
  • an inflation-adjusted conversion to current dollars;
  • a utility function converting earnings into organizational value.

Therefore the threshold grid is a sensitivity device: it asks, “How much of the resampled treatment-effect distribution clears a hypothetical minimum gain?” It does not claim that 500, 2,000, or any other threshold is an economically correct adoption rule.

L&D interpretation

The practical value of the analysis is not to declare a single “correct” training threshold. It is to show that effect significance and decision sufficiency are different questions. A historical treatment effect can be positive while support becomes progressively thinner as the minimum required benefit increases. For evidence-based L&D, that encourages a clearer sequence: estimate impact, characterize uncertainty, define the benefit requirement separately, and then inspect how robustly the evidence clears it.

The study is especially useful as a template for separating program-evaluation evidence from business-case assumptions. A modern organization would still need current implementation cost, present-value conversion, workforce similarity, intervention comparability, and an explicit utility or break-even rule before using the same logic for an actual investment decision.

What the study can claim

The historical randomized comparison supports a causal treatment contrast for this experimental setting, subject to the original study design and this reduced RE74-available subset. The repository can also show how that estimated effect looks under alternative illustrative minimum-benefit thresholds.

What the study cannot claim

The repository does not establish that the same effect would occur in contemporary corporate L&D, another population, another labor market, or current dollars. The threshold curve does not estimate ROI, expected profit, implementation probability, or a Bayesian posterior probability.

Evidence boundary

Reproduce

Offline verification:

python -m pip install -r requirements.txt
pytest -q
python run_demo.py

Verify pinned source files and recompute:

python scripts/fetch_and_analyze.py

Regenerate the full released evidence:

python scripts/fetch_and_analyze.py --write

The empirical rebuild workflow downloads both pinned source files, regenerates all derived tables and figures, runs the tests, and passes only when the working tree has zero evidence diff.

Evidence files

  • data/derived/primary_results.csv — complete 41-point threshold frontier
  • data/derived/secondary_results.csv — core estimates and uncertainty metrics
  • data/derived/robustness_results.csv — resampling configuration and frontier-crossing diagnostics
  • results/empirical_summary.json — machine-readable release summary
  • data/source_manifest.json — source definitions, row counts, treatment flags, and SHA-256 fingerprints
  • scripts/fetch_and_analyze.py — complete source-to-output pipeline
  • research/model.py — reusable statistical functions and release validation
  • tests/ — numerical, provenance, reproducibility, and consistency tests

Licensing and attribution

Repository code and original documentation are MIT licensed. The NBER-hosted data page states that the data are distributed for attributable non-commercial use (CC BY-NC). See THIRD_PARTY_DATA.md.

Research integrity

This is a secondary reanalysis of historical public experimental data. It is not preregistered, peer reviewed as a new study, a modern ROI study, or a replication of the original assignment mechanism. The repository separates source evidence, statistical uncertainty, resampling diagnostics, threshold scenarios, and interpretation.

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Empirical L&D decision-threshold study of randomized NSW training evidence with bootstrap and permutation robustness.

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