Research
Improving Treatment Effect Estimators Through Experiment Splitting
February 21, 2019
Abstract
We present a method for implementing shrinkage of treatment effect estimators, and hence improving their precision, via experiment splitting. Experiment splitting reduces shrinkage to a standard prediction problem. The method makes minimal distributional assumptions, and allows for the degree of shrinkage in one metric to depend on other metrics. Using a dataset of 226 Facebook News Feed A/B tests, we show that a lasso estimator based on repeated experiment splitting has a 44% lower mean squared predictive error than the conventional, unshrunk treatment effect estimator, a 18% lower mean squared predictive error than the James-Stein shrinkage estimator, and would lead to substantially improved launch decisions over both.
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