Trivial threshold changes can slash a case population while barely losing real disputes

Evidence

We found that increasing the threshold from zero to just $1 million (1990 constant dollars) removed approximately 25 percent of the dyads from the set of qualifying dyads. Barring dyads with only token amounts of trade improves the effectiveness of the method drastically because the number of qualifying dyads decreases significantly, while the number of “impossible” disputes increases only slightly. — Gary Goertz, Social Science Concepts, 1492

Categorization

• XREF: Parallels Milgrom’s law-merchant finding that cheap entry screening substitutes for expensive direct monitoring of every participant.