How to Use Propensity Score Matching to Measure Down Stream Causal Impact of an Event

Ad exposure is not randomly assigned – algorithms may show ads more to highly active users. As a result, “unobservable factors make exposure endogenous,” meaning there are hidden biases in who sees the ad. This is where propensity score matching (PSM) comes in – it’s a statistical way to create apples-to-apples comparisons.