The Data Detective

just as the most brilliant thinkers of the age failed to make progress while practicing in secret, secret algorithms based on secret data are likely to lead to missed opportunities for improvement.

Wishful thinking isn’t the only form of motivated reasoning, but it is a common one. We believe in part because we want to.

Before I repeat any statistical claim, I first try to take note of how it makes me feel. It’s not a foolproof method against tricking myself, but it’s a habit that does little harm and is sometimes a great deal of help. Our emotions are powerful. We can’t make them vanish, nor should we want to. But we can, and should, try to notice when they are c

cheerleaders for big data have made three exciting claims, each one reflected in the success of Google Flu Trends. First, that data analysis produces uncannily accurate results. Second, that every single data point can be captured—the “N = All” claim we met in the previous chapter—making old statistical sampling techniques obsolete (what that means

Ideally, a decision maker or a forecaster will combine the outside view and the inside view—or, similarly, statistics plus personal experience. But it’s much better to start with the statistical view, the outside view, and then modify it in the light of personal experience than it is to go the other way around. If you start with the inside view you

Modern data analytics can produce some miraculous results, but big data is often less trustworthy than small data. Small data can typically be scrutinized; big data tends to be locked away in the vaults of Silicon Valley. The simple statistical tools used to analyze small datasets are usually easy to check; pattern-recognizing algorithms can all to

The Nobel laureate economist Friedrich Hayek had a phrase for the kind of awareness that is hard to capture in metrics and maps: the “knowledge of the particular circumstances of time and place.”

This isn’t just about making money; it’s about making sure that citizens have access to accurate information about the world in which they live.

I hope I’ve persuaded you that we shouldn’t be too eager to entrust our decisions to algorithms. But I don’t want to overdo the critique, because we don’t have some infallible alternative way of making decisions. The choice is between algorithms and humans. Some humans are prejudiced. Many humans are frequently tired, harassed, and overworked. And