This week’s must-reads: the psychology of randomness, basketball’s full-court press, and a reflection on the ideas of fairness and merit in education
In “The Triumph of the Random: From banking to baseball, winning streaks owe much to the laws of chance,” Leonard Mlodinow, a teacher of randomness at Caltech, explains the psychology of curious phenomena and why Joe DiMaggio’s “epic 56-game hitting streak” may have been a fluke. (This is one of the best and more interesting articles I have read that explains and applies statistics.)
Also discussed, why looking at a five-year history of a company’s performance is a poor indicatory of an organization’s health (to say nothing of its likelihood of future performance):
Suppose we undertake an analysis of the resources, effort and ability of all the companies in the Fortune 500 and determine that every company has the same 60% chance of success in any given year. If we observe all the companies over a period of five years and the underlying probability of success were reflected in each company’s results, then over the five-year period every company would have three good years.
The mathematics of chance indeed dictate that in this situation the odds of a company having zero, one, two, four or five good years are lower than the odds of having three. Nevertheless it is not likely that a company will have three out of five good years—because there are so many of those misleading outcomes, their combined odds add up to twice the odds of having exactly three. That means that of the 500 companies, two-thirds will experience results that belie their underlying potential. In fact, according to the rules of randomness, nearly 50 of the companies will have a streak of either five good years, or five bad years, even if their corporate capacities were no better or worse than their counterparts’. And so if you judged the companies by their five-year results alone, you would probably over- or underestimate their true value.
Why — if you truly wanted to know which baseball team was superior — you might need to restructure the World Series as a best-of 269-game series:
In sports, the championship contenders are usually pretty evenly matched. But in baseball, even if one assumes that the better team has a lopsided 55/45 edge over the inferior one, the lesser team will win the seven-game World Series 40% of the time. That might seem counterintuitive, but you can look at it as follows. If you play a best-of-one game series, then, by our assumption, the lesser team will win 45% of the time. Playing a longer series will cut down that probability. The problem is that playing a seven-game series only cuts it down to 40%, which isn’t cutting it down by much. What if you demand that the lesser team win no more than 5% of the time—a constraint called statistical significance? The World Series would have to be the best of 269 games, and probably draw an audience the size of that for Olympic curling. Swap baseball for marketing, and you find a mistake often made by marketing departments: assuming that the results of small focus groups reflect a trend in the general population.
And an explanation for our tendency to attribute meaning to random acts:
We find false meaning in the patterns of randomness for good reason: we are animals built to do just that. Suppose, for example, that you sit a subject in front of a light which flashes red twice as often as green, but otherwise without pattern. After the subject watches for a while, you offer the subject a reward for each future flash correctly predicted. What is the best strategy?
A nonhuman animal in this situation will always guess red, the more frequent color. A different strategy is to match your proportion of red and green guesses to the proportion you observed in the past, that is, two reds for every green. If the colors come in some pattern that you can figure out, this strategy will enable you to be right every time. But if the colors come without pattern you will do worse. Most humans try to guess the pattern, and in the process allow themselves to be outsmarted by a rat. (Those trying to time the market lately might wish they had let the rat take charge.) Looking for order in patterns has allowed us to understand the patterns of the universe, and hence to create modern physics and technology; but it also sometimes compels us to submit bids on eBay because we see the face of Jesus in a slice of toast.
In “How David Beats Goliath,” the ubiquitous Malcolm Gladwell offers a fascinating explanation of how underdogs have — and can consistently! — triumph over physically superior and more-talented opponents. (Tip to basketball coaches and players: apply a full-court press on defense! Always!) A short excerpt from an absolute “must read!” article about the advantages of rule-breaking:
My final selection to this week’s selection of articles of interest is a reflection on the idea and role of merit in our education system — and in American society. In “Life, Liberty and the Pursuit of Aptitude,” Walter Kim asks whether “our merit-based ideas of fairness get us what we deserve?”
All systems that seek to rank human beings according to “merit” will inevitably fall short of fully accounting for what merit consists of in the real world. As such, these systems, like our Constitution, should be subject to to amendment from time to time, since no definition of merit lasts forever.
Entry filed under: etc, play, think. Tags: aptitude, banking, baseball, basketball, Bible, Caltech, David and Goliath, education, fairness, fluke, full-court press, J. R. Atwood, Joe DiMaggio, Leonard Mlodinow, logic, Malcolm Gladwell, merit, patterns, performance, psychology, psychology of success, randomness, sports, statistics, streaks, Walter Kim, World Series.