Milton Friedman’s Thermostat — Everybody knows that if you press down on the gas pedal the car goes faster, other things equal, right? And everybody knows that if a car is going uphill the car goes slower, other things equal, right? But suppose you were someone who didn’t know those two things. And you were a passenger in a car watching the driver trying to keep a constant speed on a hilly road. You would see the gas pedal going up and down. You would see the car going downhill and uphill. But if the driver were skilled, and the car powerful enough, you would see the speed stay constant. So, if you were simply looking at this particular “data generating process”, you could easily conclude: “Look! The position of the gas pedal has no effect on the speed!”; and “Look! Whether the car is going uphill or downhill has no effect on the speed!”; and “All you guys who think that gas pedals and hills affect speed are wrong!” (via Dr Data’s Blog)
Transparency Doesn’t Kill Kittens (O’Reilly Radar) — Atul Gawande says, cystic fibrosis … had data for 40 years on the performance of the centers around the country that take care of kids with cystic fibrosis. They shared the data privately […] They just told you where you stood relative to everybody else and they didn’t make that information public. About four or five years ago, they began making that information public. It’s now available on the Internet. You can see the rating of every center in the country for cystic fibrosis. Several of the centers had said, “We’re going to pull out because this isn’t fair.” Nobody ended up pulling out. They did not lose patients in hoards and go bankrupt unfairly. They were able to see from one another who was doing well and then go visit and learn from one and other.