---
title: Causal Yield
slug: causal-yield
url: https://templeton.host/lexicon/causal-yield/
type: defined-term
inDefinedTermSet: https://templeton.host/lexicon
author: Andrew Templeton
---

# Causal Yield

## Definition

yield = E[Y | do(X=1)] - E[Y | do(X=0)]. The return on an operating intervention, measured as the average treatment effect under Pearl's do-operator: the expected outcome when you set X versus when you do not. The do() is intervention, not observation - it is what separates a yield you can bank from a correlation you cannot.

## Why this term exists

Operators are paid for interventions that move the number, not for noticing that two numbers move together. A correlation says Y tends to be high when X is high; the do-operator says what Y becomes when you reach in and set X yourself. Confounders make those two quantities diverge, and the gap is exactly where operating capital gets burned - crediting a tailwind to a lever that never moved anything.

## See also

- [Directed Graph](https://templeton.host/frameworks/directed-graph)
- [Designed Convergence](https://templeton.host/frameworks/designed-convergence)
- [Operational Alpha](https://templeton.host/lexicon/operational-alpha)
- [Soft Spot](https://templeton.host/lexicon/soft-spot)
- [The Conviction Fraction](https://templeton.host/lexicon/conviction-fraction)
- [Portfolio Alpha](https://templeton.host/lexicon/portfolio-alpha)

Canonical URL: https://templeton.host/lexicon/causal-yield/