Cookies help us display personalized product recommendations and ensure you have great shopping experience.

By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
SmartData CollectiveSmartData Collective
  • Analytics
    AnalyticsShow More
    unusual trading activity
    Signal Or Noise? A Decision Tree For Evaluating Unusual Trading Activity
    3 Min Read
    software developer using ai
    How Data Analytics Helps Developers Deliver Better Tech Services
    8 Min Read
    ai for stock trading
    Can Data Analytics Help Investors Outperform Warren Buffett
    9 Min Read
    media monitoring
    Signals In The Noise: Using Media Monitoring To Manage Negative Publicity
    5 Min Read
    data analytics
    How Data Analytics Can Help You Construct A Financial Weather Map
    4 Min Read
  • Big Data
  • BI
  • Exclusive
  • IT
  • Marketing
  • Software
Search
© 2008-25 SmartData Collective. All Rights Reserved.
Reading: Newsflash: Correlation is Not a Cause!
Share
Notification
Font ResizerAa
SmartData CollectiveSmartData Collective
Font ResizerAa
Search
  • About
  • Help
  • Privacy
Follow US
© 2008-23 SmartData Collective. All Rights Reserved.
SmartData Collective > Data Management > Best Practices > Newsflash: Correlation is Not a Cause!
Best PracticesBusiness RulesExclusivePredictive Analytics

Newsflash: Correlation is Not a Cause!

paulbarsch
paulbarsch
5 Min Read
SHARE

Just about every data scientist and statistician knows that correlation doesn’t necessarily confirm causation. However, popular business and social literature often confuse the two concepts. By understanding the maxim of “correlation is not a cause” more clearly, it’s possible to let loose creativity and imagination of the questioning mind.

Just about every data scientist and statistician knows that correlation doesn’t necessarily confirm causation. However, popular business and social literature often confuse the two concepts. By understanding the maxim of “correlation is not a cause” more clearly, it’s possible to let loose creativity and imagination of the questioning mind.

Humans like to think and speak in declarative terms. For a sampling, imagine statements bandied about by pundits such as; “global warming is caused by humans”, or “the Financial Crisis of 2008 was caused by greedy bankers” or “Republicans lost the 2008 election because they didn’t pay enough attention to immigration issues.”

More Read

big data is impacting trading
How Big Data Technology Impacts Investments and Trading
Essential Proxy Selection Tips For Web Data Mining
How Big Data And Machine Translation Combine To Fight COVID-19
Big Data Is Offering Awesome Homework Solutions For Students
#13: Here’s a thought…

Psychologist and author Sue Blackmore says the simple reminder that “correlation is not a cause” (CINAC), would improve just about everyone’s mental toolkit. Case in point, in an Edge.org article, she gives an example of people filling up a railway station as a scheduled train approaches.  She asks, “Did the people cause the train to arrive (A causes B)? Or did the train cause people to arrive (B causes A)?” The answer she says is they both depended on a railway timetable (C caused both A and B)!

Editor’s note: Paul Barsch is an employee of Teradata. Teradata is a sponsor of The Smart Data Collective.

In linear systems, cause and effect is much easier to pinpoint. However, the world around us is considered a complex system where there are often multiple variables pushing an outcome to occur. Nigel Goldenfeld, a professor of physics at University Illinois, sums it up best: “For every event that occurs, there are a multitude of possible causes, and the extent to which each contributes to the event is not clear. One might say there is a web of causation.”

And author Richard Bookstaber says that it’s a difficult search to pinpoint cause in complex systems especially because, “a change in one component can propagate through the system to lead to surprising and apparently disproportionate effect elsewhere, e.g. the famous “butterfly effect””.

The concept that in complex systems there is a “web of causation” may not sit right with some individuals, especially since newscasters, publishers, and even a fair portion of scientists prefer to insist on simple declarations of true and false.  However, the very nature of complex systems is that every object is in some way linked to another with either weak or strong ties and often connections are opaque and mysterious. So even a correlation of one, may not necessarily mean A causes B.

Freeing ourselves from the shackles of CINAC thinking means we have the possibility to let loose our imaginations says psychologist Sue Blackmore. Each definitive report should be greeted with skepticism. And when “A causes B” is held up as the answer, Blackmore cautions, then the critical mind automatically gets to work thinking; “Maybe instead, B actually causes A! And if not, what are the other opportunities?”

It’s human nature to try and explain the world around us. However, when it comes to complexity, we should lead discussions with a measure of humility to include questions and possibilities rather than declarations of certainty.

Questions:

  • How does our “aim to explain” end up stifling innovation and creativity?
  • The US Securities and Exchange Commission posited an explanation for the May 6, 2010 “Flash Crash”, but experts are not buying their simplistic explanation of a single “trigger event”. What are your thoughts?
TAGGED:analysisCorrelation does not imply causationstatistics
Share This Article
Facebook Pinterest LinkedIn
Share

Follow us on Facebook

Latest News

data migration risk prevention
Best Approach to Risk Management for Data Migration in Data-Driven Businesses
Big Data Data Management Exclusive Risk Management
AI in branding
How Data Analytics and Data Mining Strengthen Brand Identity Services
Big Data Exclusive
Hidden AI, a risk?
Hidden AI, Real Risk: A Governance Roadmap For Mid-Market Organizations
Artificial Intelligence Exclusive Infographic
unusual trading activity
Signal Or Noise? A Decision Tree For Evaluating Unusual Trading Activity
Analytics Exclusive Infographic

Stay Connected

1.2KFollowersLike
33.7KFollowersFollow
222FollowersPin

You Might also Like

Is Your eCommerce Website Suffering From Usability Issues?

8 Min Read

Analytics: Not About Saving Time

7 Min Read

Freakonomics and Your Data

6 Min Read

Squealer Pig’s Persuasive (Mis)Use of Statistics

3 Min Read

SmartData Collective is one of the largest & trusted community covering technical content about Big Data, BI, Cloud, Analytics, Artificial Intelligence, IoT & more.

ai in ecommerce
Artificial Intelligence for eCommerce: A Closer Look
Artificial Intelligence
AI and chatbots
Chatbots and SEO: How Can Chatbots Improve Your SEO Ranking?
Artificial Intelligence Chatbots Exclusive

Quick Link

  • About
  • Contact
  • Privacy
Follow US
© 2008-25 SmartData Collective. All Rights Reserved.
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?