10 November 2012

Statistical significance is just like a horse race

Green Moon had a chance of less than 1 in 22 of winning the race
The logic of statisticians can seem very complicated and impenetrable to normal folk.

But it really is just a formalised version of our own lay style of how we explain unusual events.

When something unusual happens, there are two possible interpretations.  One is to view the unusual event as a freak occurrence, a chance-result, a coincidence.  The other is to view the event as a sign that our understanding of what is going on is fundamentally wrong.

So, is the unusual event simply surprising or does it stretch credulity?  Did we see a rare occurrence or is there some other explanation?

It's a bit like interpreting the result of a horse race won by a horse with long odds.  Is the win a possibility even if improbable, or is it so improbable as to be considered an 'impossibility' requiring a brand new explanation.

Read more on this idea in my article posted on The Drum / ABC : The Melbourne Cup and Statistical Significance

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