Monday, October 07, 2013

Fighting our Biases, Empathy Edition

Here is an example of how reporting on social science research can mislead rather than inform. The author tells us about new studies that show rich people are less empathic (i.e., they care less about others) than poor people. While this may be true on average (and the author gives several reasons why this might be so), the article likely inflames biases rather than illuminates reality.

Why? Because the author neglects to tell us: a) how big the difference in empathy between the two groups is, and b) the underlying distribution of empathy within the rich and poor groups.

The almost inevitable result is that the article will spur one group to be more self-righteous and confident and the other group to be more defensive and angry.  

The underlying analyses generally involve complex regressions, but let's simplify a bit so we can imagine two competing realities behind the results of the study cited.

Figure 1 reveals what most readers will take away from a newspaper story like this.  It shows two distribution curves, one of rich people, and one of poor people.

Figure 1: Huge difference; no overlap
In this scenario, not only do rich people have much less empathy (C) on average than do poor people (D), but ALL rich people have less empathy than ALL poor people. The two distribution curves don't even intersect.

Contrast this with Figure 2:

Figure 2: Small difference; large overlap
In this scenario, rich people do have less empathy on average than poor people.  But the difference (B-A) is much smaller.  And there is huge overlap between the two groups.  There are plenty of rich people who are empathic, and plenty of poor people who are not.

Figure 2 more accurately represents the results of most social science research.  When scientists get lucky, they find a characteristic (in this case, wealth) that has a statistically significant impact on another characteristic (in this case empathy).  But statistical significance does not mean that the difference is large. And even more rarely does it mean that the underlying groups have little or no overlap.

[PS:  Apologies for the poor graphing skills.]

Share on Facebook

Wednesday, October 02, 2013

How to Get Lucky

Luck has a lot to do with success.  That is both my experience and the conclusion of a lot of research, including by Daniel Kahneman, winner of the 2002 Nobel Prize, who famously said:
Success = Talent + Luck. 
Great Success = A little more Talent plus a lot more Luck.
Many successful people find this assertion annoying, since they feel that they have worked very hard to succeed.  As noted in my previous post, these people suffer from survivorship bias: they fail to notice all the other people in the world who worked equally hard but failed to succeed.  (Warren Buffet is a noted exception; he has repeatedly noted that he was in the right place at the right time.)

But the good news for those less enlightened (and lucky) than Warren Buffet is that luck can be cultivated - it's not merely a matter of chance.  Psychologist Richard Wiseman argues that luck is the outcome of human interaction with chance:
Wiseman speculated that what we call luck is actually a pattern of behaviors that coincide with a style of understanding and interacting with the events and people you encounter throughout life. Unlucky people are narrowly focused, he observed. They crave security and tend to be more anxious, and instead of wading into the sea of random chance open to what may come, they remain fixated on controlling the situation, on seeking a specific goal. As a result, they miss out on the thousands of opportunities that may float by. Lucky people tend to constantly change routines and seek out new experiences. 
This at least leaves open the possibility that we can make ourselves luckier by changing our outlooks:
Wiseman saw that the people who considered themselves lucky, and who then did actually demonstrate luck was on their side over the course of a decade, tended to place themselves into situations where anything could happen more often and thus exposed themselves to more random chance than did unlucky people. The lucky try more things, and fail more often, but when they fail they shrug it off and try something else. Occasionally, things work out.
So luck is part persistence, but the speed at which we experiment is also key:
The people who labeled themselves as generally unlucky took about two minutes to complete the task. The people who considered themselves as generally lucky took an average of a few seconds. Wiseman had placed a block of text printed in giant, bold letters on the second page of the newspaper that read, “Stop counting. There are 43 photographs in this newspaper.” Deeper inside, he placed a second block of text just as big that read, “Stop counting, tell the experimenter you have seen this and win $250.” The people who believed they were unlucky usually missed both. 
And finally, part of the challenge is a willingness to abandon hypotheses and assumptions when they don't pan out:
What you can’t see, and what they can’t see, is that the successful tend to make it more probable that unlikely events will happen to them while trying to steer themselves into the positive side of randomness. They stick with it, remaining open to better opportunities that may require abandoning their current paths, and that’s something you can start doing right now without reading a single self-help proverb, maxim, or aphorism. 
[The quoted passages are from David McRaney.]

Share on Facebook

Anybody Read the Latest MisFortune Magazine?

If you are thinking about opening a restaurant because there are so many successful restaurants in your hometown, you are ignoring the fact the only successful restaurants survive to become examples. Maybe on average 90 percent of restaurants in your city fail in the first year. You can’t see all those failures because when they fail they also disappear from view.  
These words of wisdom are from David McRaney, whose work illuminates common human mistakes - in this case, survivorship bias. If we want to know how to succeed, shouldn't we look to successful people and companies for lessons to follow? The paradox is that we can often learn more from those who fail:
Survivorship bias pulls you toward bestselling diet gurus, celebrity CEOs, and superstar athletes... You look to the successful for clues about the hidden, about how to better live your life... Colleges and conferences prefer speakers who shine as examples of making it through adversity, of struggling against the odds and winning. The problem here is that you rarely take away from these inspirational figures advice on what not to do, on what you should avoid, and that’s because they don’t know. Information like that is lost along with the people who don’t make it out of bad situations or who don’t make it on the cover of business magazines – people who don’t get invited to speak at graduations and commencements and inaugurations.  
McRaney goes on:
If you spend your life only learning from survivors, buying books about successful people and poring over the history of companies that shook the planet, your knowledge of the world will be strongly biased and enormously incomplete. As best I can tell, here is the trick: When looking for advice, you should look for what not to do... [K]eep in mind that those who fail rarely get paid for advice on how not to fail, which is too bad because despite how it may seem, success boils down to serially avoiding catastrophic failure while routinely absorbing manageable damage.