The observation that patterns emerge before reasons for them become apparent 4

The observation that patterns emerge before reasons

  • No School
  • AA 1
  • 13

This preview shows page 9 - 11 out of 13 pages.

The observation that “patterns emerge before reasons for them become apparent” 4 tends to resonate universally among people, particularly in financial markets, marketing, and even healthcare. If this is true, Box’s observation becomes very relevant: if a problem is non -stationary and a model will be approximate, why not build the best predictive model based on data available until that time and just update it periodically? Why bother developing a detailed causal model if it is poor at prediction and more importantly, likely to get worse over time due to “concept drift?” Anderson’s point has particular relevance in the health , social, and earth science in this era of big data since these areas have generally been characterized by the lack of solid theory but where we are now seeing huge amounts of data that can serve as grist for theory building. For illustration, contrast the areas of physics and social sciences which lie at opposite ends of the spectrum in terms of the predictive power of their theories. In physics, a theory is expected to be “complete” in the sense that a relationship among certain variables is intended to explain the phenomenon completely , with no exceptions. Such a model is expected to make perfect predictions (subject to measurement error, but not error due to omitted variables or unintended consequences). In such domains, the explanatory and predictive models are synonymous. The behavior of a space shuttle, for example, is completely explained by the
Image of page 9

Subscribe to view the full document.

causal model that describes the forces acting on it. This model can also be used to predict what will happen if any of the inputs change. It is not sufficient to have a model which is 95% sure of outcomes, and leave the rest to chance. Engineering follows science. In contrast, the social sciences are generally characterized by incomplete models that are intended to be partial approximations of reality, often based on assumptions of human behavior known to be simplistic. A model that is correct 95% of the time in this world would be considered very good. Ironically, however, the emphasis in social science theory development is on proposing theories that embody c ausality without serious consideration of their predictive power. When such a theory claims that “A causes B” data are gathered to confirm whether the relationship is causal. But its predictive accuracy could be poor because the theory is incomplete. Indeed, it is not uncommon for two experts in the social sciences to propose opposite relationships among the variables and to offer diametrically opposite predictions based on the same sets of facts. Economists, for example, routinely disagree on both theory and prediction, and are often wrong in their forecasts.
Image of page 10
Image of page 11

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Ask Expert Tutors You can ask 0 bonus questions You can ask 0 questions (0 expire soon) You can ask 0 questions (will expire )
Answers in as fast as 15 minutes