The Problem is Beyond Psychology: The Real World is More Random than Regression Analyses

International Journal of Forecasting, Forthcoming

4 Pages Posted: 10 Oct 2011 Last revised: 14 Dec 2017

See all articles by Nassim Nicholas Taleb

Nassim Nicholas Taleb

New York University (NYU) - NYU Tandon School of Engineering

Daniel G. Goldstein

Microsoft Research New York City

Date Written: October 10, 2011

Abstract

Where the problem is not expert underestimation of randomness, but more: the tools themselves used in regression analyses and similar methods underestimate fat tails, hence the randomness in the data. We should avoid imparting psychological explanations to errors in the use of statistical methods.

Suggested Citation

Taleb, Nassim Nicholas and Goldstein, Daniel G., The Problem is Beyond Psychology: The Real World is More Random than Regression Analyses (October 10, 2011). International Journal of Forecasting, Forthcoming, Available at SSRN: https://ssrn.com/abstract=1941792

Nassim Nicholas Taleb (Contact Author)

New York University (NYU) - NYU Tandon School of Engineering ( email )

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Brooklyn, NY 11201
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Daniel G. Goldstein

Microsoft Research New York City ( email )

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New York, NY 10011
United States

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