We distinguish between identification and establishing causality. Identification means forming a unique mapping from features of data to quantities that are of interest to economists. Establishing causality by finding sources of exogenous variation is often considered synonymous with...

A survey of 255 papers that rely on the instrumental variable (IV) approach for identifying causal effects published in the "Big Three" finance journals reveals that IV estimates are larger than their corresponding uninstrumented estimates in about 80% of the studies, regardless of whether the...