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COMPEL Glossary / counterfactual-outcome

Counterfactual outcome

The outcome that would have occurred without the AI intervention — the benchmark against which incremental AI value is measured.

What this means in practice

Estimated via randomised controlled trial, quasi-experiment, or synthetic control; without a counterfactual claim, value estimates cannot distinguish AI impact from macro trends or concurrent initiatives.

Synonyms

counterfactual , but-for outcome

See also

  • Incremental value — Delivered outcome minus counterfactual outcome — the only value quantity that survives CFO and audit-committee scrutiny.
  • A/B test (RCT) — A randomised controlled trial in which units are randomly assigned to treatment (AI feature) and control (no feature or baseline feature).
  • Difference-in-differences (DiD) — A quasi-experimental design comparing treated and control trajectories over time — identifying causal effect from differential change.
  • Synthetic control — A counterfactual constructed from a weighted combination of untreated donor units — the "synthetic" version of the treated unit.

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