  Binscatter is a popular method for visualizing bivariate relationships and
conducting informal specification testing. We study the properties of this
method formally and develop enhanced visualization and econometric binscatter
tools. These include estimating conditional means with optimal binning and
quantifying uncertainty. We also highlight a methodological problem related to
covariate adjustment that can yield incorrect conclusions. We revisit two
applications using our methodology and find substantially different results
relative to those obtained using prior informal binscatter methods. General
purpose software in Python, R, and Stata is provided. Our technical work is of
independent interest for the nonparametric partition-based estimation
literature.
