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CRUNCHING on Empty, CRUNCHING Blind (Apologies to Jackson Browne)
on November 11, 2007
Is it a new brand of cereal? Or maybe it's a granola bar, or a chunky peanut butter spread? Then again, could it be the latest infomercial exercise device designed to give you the six pack abs you've always dreamed of but know in your heart of hearts you'll never achieve? Actually, it's a book - the title a product of the very methods the book describes. Here's what SUPER CRUNCHERS says.
(1) Mathematical regression models generated from large datasets often generate better predictions than human experts, and they provide supporting information on the predictive weight and reliability of each explanatory variable.
(2) Well-crafted experiments using randomized trials and control groups provide good market research and behavioral analysis results.
(3) Technological advances - the Internet, massive data storage devices, rapid computation, broadband telecommunication - are making it possible to share more sources of information and create ever-larger databases for analysis.
(4) Today's companies engage in multiple forms of market research by creating and using large databases and large-scale randomized trials.
(5) Many phenomena conform to normal distributions in which 95% of the population will be found within two standard deviations of the mean, the5% balance generally divided evenly in the two tails.
That's it. I just saved you $25.00 U.S. and a half-dozen or more hours learning how a guy from Yale named Ian Ayres collected a bit of information about applied mathematical techniques that have been in practical use for decades, packaged them up, palmed them off as something new, and cooked up the ridiculous name Super Crunching to describe an ostensibly new technological development. Yet "Super Crunching" is nothing more than the author's marketing hype for a couple of standard mathematical methodologies, a creation of nothing from something. There's no new breakthrough here, no new paradigm.
Yes, the anecdotal information about the future prices of wine vintages, Capital One's teaser offerings, and evidence-based medical diagnosis are interesting (hence the two stars rating). The rest, however, is neither prescriptive nor sufficiently critically analytical. Should we go out shopping for a Super Cruncher tomorrow? Should we delight in the increased accuracy of data-driven modeling and prediction, or should we fear the implied manipulation of our desires and the incessant, single-minded drive toward maximum profit at the expense of creativity? Do we really want movies and books to be developed from mathematical models like Epagogix? Do we really want our every keystroke on the Internet to be fodder for market research that manipulates us in response? John Kenneth Galbraith, among others, warned of exogenous, manufactured demand decades ago.
SUPER CRUNCHERS is part business tome, part econometric paean, and part sociology book, but not fully any of the three. No matter how many time the author uses words like "cool" and "humongous" and "amazing," it's still regrettably a "No Sale" even for someone like me who enjoys reading about applied mathematics.