Abstract:
The literature on causality takes contradictory stands regarding the direction of causal relationships
based on whether one uses temporally aggregated or systematically sampled data. Using the
relationship between a nominal target and the instrument used to achieve it, as an example, we show
that one can fall back upon the data in itself, and analyse it from the perspective of economic theory,
not only as a source of second opinion to econometric theories and Monte Carlo simulations, but also
to draw proper conclusions regarding the form of the causal relationship that might be actually existing
in the data.