In his new white paper, Managing Director Dr. David Tabak examines a form of p-hacking, or making various attempts to obtain a statistically significant or insignificant result, in which an expert examines different event-window lengths in an event study. A failure to account for the examination of multiple potential event windows can lead to incorrect assessments of the statistical significance of a security’s price movement.

Evidence of event-window p-hacking can be shown by an unjustified lack of consistency of methodologies to determine event-window lengths in an expert’s previous analyses or within the current case. Dr. Tabak provides empirical evidence regarding how unaccounted-for choices in the length of an event window can affect the measurement of statistical significance. Dr. Tabak also explains that while there may sometimes be a reason to deviate from a standard methodology, there should be a high burden to show that the deviation is theoretically justified and not designed for the purpose of achieving certain results.

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