The Challenge of Generating Causal Hypotheses Using Network Models

Statistical network models based on Pairwise Markov Random Fields (PMRFs) are popular tools for analyzing multivariate psychological data, in large part due to their perceived role in generating insights into causal relationships: a practice known as causal discovery in the causal modeling literature. However, since network models are not presented as causal discovery tools, the role they play in generating causal insights is poorly understood among empirical researchers. In this paper, we provide a treatment of how PMRFs such as the Gaussian Graphical Model (GGM) work as causal discovery tools, using Directed Acyclic Graphs (DAGs) and Structural Equation Models (SEMs) as causal models. We describe the key assumptions needed for causal discovery and show the equivalence class of causal models that networks identify from data. We clarify four common misconceptions found in the empirical literature relating to networks as causal skeletons; chains of relationships; collider bias; and cyclic causal models.