What is Natural experiment?
A natural experiment is a research design that exploits a naturally occurring event, policy change, or circumstance that creates treatment and control groups without deliberate randomization by the researcher.
How it works
Natural experiments arise from lottery assignments, geographic boundaries, policy discontinuities, and sudden events that differentially affect otherwise similar populations. They provide causal evidence that is stronger than observational studies (because the assignment mechanism is quasi-random) but weaker than randomized experiments (because the researcher did not control the assignment). The Vietnam draft lottery, which randomly assigned draft numbers to birthdates, enabled researchers to study the causal effect of military service on earnings without selection bias.
Applied example
When Oregon randomly selected applicants for Medicaid expansion in 2008, researchers used the lottery as a natural experiment to study the causal effect of health insurance on health outcomes, financial stress, and healthcare utilization.
Why it matters
Natural experiments provide causal evidence for questions that cannot ethically be studied through randomized experiments, filling critical gaps in behavioral and policy research.
