THE FOURTH QUADRANT: A MAP OF THE LIMITS OF STATISTICS by Nassim Nicholas Taleb. "In the following Edge original essay, Taleb continues his examination of Black Swans, the highly improbable and unpredictable events that have massive impact. He claims that those who are putting society at risk are "no true statisticians", merely people using statistics either without understanding them, or in a self-serving manner.
posted by vronsky on Sep 16, 2008 - 41 comments

Experts can suck at predicting the future. Their intuitive sense of probability is no more developed than lay-people's. A classic experiment is to present two indistinguishable choices are presented, but with unequal probability of reward. Humans look for complex patterns, which don't exist, and preform quite poorly. Rats quickly recognize the choice with higher probability, and preform optimally.
posted by jeffburdges on Dec 11, 2005 - 34 comments

Incredible -- but true coincidences are fascinating, and pleasing, to the psyche. I tend to agree with John Littlewood (a University of Cambridge mathematician) that "...in the course of any normal person's life, miracles happen at a rate of roughly one per month." In other words, statistically speaking, unusual coincidences are to be expected in a world teeming with billions of humans. Still, I find such coincidences stangely inspiring. More can be found here.
posted by ember on Jul 7, 2005 - 97 comments

The Logic of Diversity "A new book, The Wisdom of Crowds [..:] by The New Yorker columnist James Surowiecki, has recently popularized the idea that groups can, in some ways, be smarter than their members, which is superficially similar to Page's results. While Surowiecki gives many examples of what one might call collective cognition, where groups out-perform isolated individuals, he really has only one explanation for this phenomenon, based on one of his examples: jelly beans [...] averaging together many independent, unbiased guesses gives a result that is probably closer to the truth than any one guess. While true — it's the central limit theorem of statistics — it's far from being the only way in which diversity can be beneficial in problem solving." (Three-Toed Sloth)
posted by kliuless on Jun 20, 2005 - 6 comments

Expect a miracle? Freeman Dyson on Littlewood's Law of Miracles: "...the total number of events that happen to us is about thirty thousand per day, or about a million per month. ...The chance of a miracle is about one per million events. Therefore we should expect about one miracle to happen, on the average, every month." From his review of book debunking the paranormal (whose views he isn't entirely willing to accept). Via Marginal Revolution
posted by Jos Bleau on Jul 14, 2004 - 33 comments