Reference no: EM131064230

MINI CASE 13.1

This may seem a very obvious statement but problem understanding does require challenging, provocative and testing questions. To merely ask the same questions, look for nothing new, is likely to leave you with the same answers. The asking of questions is not merely a search for agreement but rather an opportunity to allow other explanations to emerge. The use of data is important. It provides the evidence we need to accept or reject any new ideas or explanations. Data should not just be accepted at 'face value'. We need to ask what 'does it mean'. The relationship between the measurements we have is likely to be complex. To know the growth of the student population and the prison population (they tend to be correlated) may give you some interesting figures but gives little understanding of either.

Steven Levit and Stephen Dubner in their book 'Freakonomics' ask a series of probing questions that give different insights into social and economic life. They do ask questions like:

? Is sumo wrestling corrupt?

? Are real-estate agents like the Ku Klux Klan?

? If drug dealers make so much money why do they live with their mothers?

? Where have all the criminals gone?

The authors developed their ideas in a later book 'Super freakonomics' where they discuss issues such as global warming, solving what were seemingly intractable problems, and birth and death. In both books sources of data are explored to see whether there is evidence, for example, that teachers cheat or the outcomes of a sumo wrestling bout cannot be merely explained by chance. Some of the explanations are controversial like the reintroduction of legal abortion in America in the 1970s is an important explanatory factor in the (unexpected) fall of violent crime in the 1990s. There is an examination of the difference a child's name can have of their chances in life with examples like Winner, who became a detective in the New York Police Department and Loser who became a criminal. The imaginative use of data also allows the exploration of the economic activity level we refer to as the black economy. You won't find official figures on work done 'cash in hand' but it is important in certain sectors and does make a difference to certain groups of individuals. Freakonomics and Super freakonomics are adventurous books that put forward different ideas and attempt to test them by an imaginative use of data. We are familiar with a legal system that assumes innocence until proven guilty. In the same way, we can start with a null hypothesis of innocence, or the abortion rate makes no difference to social fabric, or your name makes no difference to opportunity, or that a hidden economy does not exist. The alternative hypothesis is going to be one of making a difference. On the basis of evidence, we accept or reject the null hypothesis. The evidence is data based and may require considerable analysis. Testing ideas (hypothesis) can be a challenging way to use data. The acceptance of an hypothesis does not mean that it is definitely correct. There is always a chance that it is wrong but it is a good way of exploring existing wisdom. You still need to give an interpretation and you still need to draw your own conclusions.