Data Miners of the World, Unite

Asked about the paucity of statistics while he was implementing the policies that turned postwar Hong Kong into a thriving global financial centre, John Cowperthwaite replied: if I let them compute statistics, they’ll want to use them for (scenario) planning. Asked about some of the measures he would advocate for a turnaround, Nassim "Black Swan" Taleb replied: I don’t like scenario planning, because people don’t think out of the box. I would also ban the use of statistics because unless you know statistics very, very well, it’s a dangerous, double-edged sword.

In one of his latest posts, Sanjay demonstrates how per capita shrinks with a sinking rupee. Statistics are always relative. They depend on the elements factored in their computation, and these are never constant. That's why dogmas such as 1)VAT reduction automatically boosts consumption, 2) exchange rates invariably affect imports and exports and 3) PRB provision is systematically inflationary are all flawed.

As a matter of fact, we do not need statistics that feed trite debates and provide a smokescreen to incompetence. We nevertheless need them to decipher patterns and measure supply and demand to reduce inadequacies and improve flow everywhere.