The Art of Statistical Thinking

Detect Misinformation, Understand the World Deeper, and Make Better Decisions.

Albert Rutherford, Jae H. Kim PhD

• Publisher: PublishDrive
• Year: 2022
• Print ISBN: 9798358180710
• eBook ISBN: 9798215560464
• Topic: Economics
• Subtopic: Statistics for Business & Economics
• Index: Economics

Not knowing statistics can lead to a loss of money, time, and accurate information.

What am I looking at? What do these numbers mean? Why? These are frequent thoughts of those who don't know much about statistics.

"I'm not a number's person" is not a good excuse to avoid learning the basics of this essential skill. Are you a person who earns money? Do you shop at the supermarket? Do you vote? Do you read the news? I'm sure you do.

Learn to make decisions like world leaders do.

Do you like to make uninformed, often poor decisions? Are you okay with being manipulated by skewed charts and diagrams? How about being lied to about the effectiveness of a product? I'm sure you don't.

Statistics can help you make exponentially better calls on what to buy, who to listen to, and what to believe.

This book offers a detailed, illustrated breakdown of the fundamentals of statistics. Develop and use formal logical thinking abilities to understand the message behind numbers and charts in science, politics, and economy.

Sharpen your critical and analytic thinking skills.

Know what to look for when analyzing data. Information gets skewed – often unintentionally – because of the mainstream ways of doing statistics that didn't catch up to big data. Stop staying in the dark. This book shines the light on the most common statistical methods - and their most frequent misuse. This step-by-step guide not only helps you detect what goes wrong in statistics but also educates you on how to utilize invaluable information statistics gets right to your benefit.

Avoid making decisions on misleading information.

- How to Use Descriptive and Inferential Statistics to Understand the World.

- Be Wary of Misleading Charts.

- Make Better Decisions Using Probability.

- Understand P-Values in Research.

- Understand Potential Bias in Studies.

Albert Rutherford is the internationally bestselling author of several books on systems thinking, game theory, and mathematical thinking. Jae H. Kim is a freelance writer in econometrics, statistics, and data analysis. Since obtaining his PhD in econometrics in 1997, he has been a professor in major Australian universities until 2022. He has published more than 70 academic articles and book chapters in econometrics, empirical finance, economics, and applied statistics, which have attracted nearly 5000 citations to date.

Learn basic statistics and spend your money wisely.

Statistics, as a learning tool, can be used or misused. Some will actively lie and mislead with statistics. More often, however, well-meaning people – even professionals - unintentionally report incorrect statistical conclusions. Knowing what errors and mistakes to look for will help you to be in a better position to evaluate the information you have been given.

Table of contents

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• Introduction
• Chapter 1: Definition and Basic Concepts
• 1. Sample versus population.
• 2. Descriptive statistics.
• 3. Sample statistics and population parameters.
• 4. Descriptive statistics for relative position.
• 5. Data Visualization
• 6. Comparing alternative distributions.
• 7. Normal distribution.
• 8. Checking the normality of a distribution.
• 9. Concluding remarks
• Chapter 2: Inferential statistics
• 1. Random (Repeated) Sampling and Sampling Distribution
• 2. Understanding the test statistic.
• 3. Effect size vs. sample size.
• 4. Inferential statistics.
• 5. Concluding Remarks.
• Chapter 3: Statistical Thinking
• 1. Understanding uncertainty.
• 2. Research design.
• 3. Alpha, beta, and power.
• 4. Implications to research with Big Data.
• 5. Choosing the level of significance.
• 6. A brief history of modern statistics.
• 7. Concluding remarks
• Chapter 4: How is Statistics Applied in Real Life?
• Investment Decision
• Opinion Polls
• Economics Research
• Medical Research
• Economic and Business Forecasting
• Stock trading and portfolio selection
• Risk management
• Concluding remarks
• Chapter 5: Misinterpretations of Statistics
• Illusion of Statistical Significance.
• Big data hubris: misinterpretation of the central limit theorem?
• Sampling bias.
• Cherry-picking.
• Correlation, not causation.
• Statistical insignificance.
• Misleading visualization.
• Concluding Remarks
• Before You Go...
• About the Authors
• References
• Endnotes