Numbers Rule Your World summary

To understand the basics of how statistical reasoning can be applied to real-life situations, it’s helpful to consider two examples: the first offers a peek at epidemiologists who try to explain the causes of diseases; and the second shows how credit modelers seek correlations that indicate a person’s financial responsibility – essential information for banks and insurers.

In the first example, epidemiologists use statistics to identify causal relationships that can pinpoint the outbreak of a disease and its origin. For instance, in September of 2007, several patients in the United States tested positive for E. coli, a bacteria that can lead to severe discomfort, kidney failure and even death. These few cases were enough to uncover the disease’s source and protect the health of others.

As the idea of correlation demonstrated, differences between groups of people are essential to statistical reasoning. Whether they show disparities between an older generation and a younger one, or people who hold a college degree and those who don’t, group differences are fundamental to statistics.

For one, statistics take group differences into consideration to design fair exams. Statisticians can make sure standardized tests like the SAT are fair by omitting questions that give preference to one social demographic over another.

It may seem that, in modern times, it’s difficult to keep the truth from surfacing. After all, people have developed all manner of methods to uncover facts, like drug testing to expose steroid use among athletes, or polygraphs to unearth what people won’t admit. However, these modes of testing are not entirely error proof.

In fact, if testing for drug use, two types of errors can cause problems: the false positive, when an athlete who did not take drugs is falsely accused of doing so, and the false negative, when an athlete who did cheat is exonerated.

While most people wouldn’t associate the field of statistics with fighting crime or erasing irrational fears, statistical logic can do exactly these things.

Statistics teach us to question patterns that appear obvious. For instance, on October 31st, 1999, an EgyptAir jetliner plummeted into the Atlantic Ocean off the coast of Nantucket Island, Massachusetts, leaving no survivors. But between 1996 and 1999, before this tragedy occurred, three other jets had crashed into the ocean right around the same location.