Abstract
Uplift modeling, also referred to as heterogeneous treatment effect estimation, is a machine learning technique utilized in marketing for estimating the incremental impact of treatment on the response of each customer. Uplift models face a fundamental challenge in causal inference because the variable of interest (i.e., the uplift itself) remains unobservable. As a result, popular uplift models (such as meta-learners and uplift trees) do not incorporate loss functions for uplifts in their algorithms. This article addresses that gap by proposing uplift models with quasi-loss functions (UpliftQL models), which separately use four specially designed quasi-loss functions for uplift estimation in algorithms. Using simulated data, our analysis reveals that, on average, 55% (34%) of the top five models from a set of 14 are UpliftQL models for binary (continuous) outcomes. Further empirical data analysis shows that over 60% of the top-performing models are consistently UpliftQL models.
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Hu, J., de Haan, E. & Skiera, B. Uplift modeling with quasi-loss-functions. Data Min Knowl Disc (2024). https://doi.org/10.1007/s10618-024-01042-x
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DOI: https://doi.org/10.1007/s10618-024-01042-x