Do the math

Pic c/o hwupdate.org

Ben Goldacre – Mr Bad Science – has a nice piece in today's Guardian on how poor we are at maths and how this can lead us to make pretty poor decisions about medicines. [Much better headline at Ben's blog than online, btw. Hence the picture]

Daniel Kahnemann's Nobel Prize-winning work (with Tversky) on our (ir)rational decision-making was as much based on work with scientists and doctors as with their patients. As John Allen Paulos discovered: A Mathematician Plays the Markets is the story of how he lost his shirt on Enron, World.com etc, despite being a brilliant mathematician.

Some obvious applications of this insight include:
Super-brainy sharp-suited city types who herd and flock vs. Warren Buffet
"Here comes the science bit"
How we overestimate crime rates
How we respond to rare but terrible events