Download this Paper Open PDF in Browser

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  

Nassim Nicholas Taleb

NYU-Tandon School of Engineering

Daniel G. Goldstein

Microsoft Research New York City; London Business School

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)

NYU-Tandon School of Engineering ( email )

Bobst Library, E-resource Acquisitions
20 Cooper Square 3rd Floor
New York, NY 10003-711
United States

Daniel G. Goldstein

Microsoft Research New York City ( email )

641 Avenue of Americas
New York, NY 10011
United States

London Business School ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom
+44 0 20 7000 8611 (Phone)
+44 0 20 7000 8601 (Fax)

HOME PAGE: http://www.dangoldstein.com

Paper statistics

Downloads
2,910
Rank
3,009
Abstract Views
9,198