Can you trust statistics? 1 MAT2375 Lecture #1 by D. McDonald from the Department of Mathematics and Statistics Can you trust Statistics?

Can you trust statistics? 2 In 1953: 60,000 victims of polio in the USA In the early 1950’s Dr. Jonas Salk developed a vaccination against polio. Before a massive vaccination program could be started it was necessary to prove the vaccine was effective.

Can you trust statistics? 3 A Randomized, Controlled Experiment 400,000 elementary school students participated in the experiment. 200,000 chosen at random from in the treatment group got the vaccine. The remaining 200,000 in the control group did not get the vaccine.

Can you trust statistics? 4 A Randomized, Controlled Double-Blind Experiment The 200,000 children in the control got a fake vaccination called a placebo. The children and their parents were not told if they got the real vaccine or not. Even the doctors and nurses didn’t know; only the statisticians knew

Can you trust statistics? 5 Experimental Results Looks promising but is it significant? SizeRate Treatment200,00028 Control200,00071 Total400,00099

Can you trust statistics? 6 Analysis: The Devil’s Advocate Let’s play the devil’s advocate. Let’s assume the vaccine has no effect. Then the 99 cases of polio were split into the two groups purely at random. Is it very likely only 25 fall in the treatment group?

Can you trust statistics? 7 A Probability Model Put 400,000 balls in an urn with 99 black and the rest white. Draw 200,000 (for the treatment group) and count the number of black balls. What is the chance of a split as extreme or more extreme than 28 in the treatment group and 71 in the control group. About one in a billion

Can you trust statistics? 8 Calculating Probabilities A statistician relies on the theory of probability to calculate probabilities. The number of black balls X in the treatment group follows the hypergeometric distribution.

Can you trust statistics? 9 Conclusion: Get vaccinated! We must reject the hypothesis that the treatment has no effect; otherwise we must believe we are incredibly unlucky. We can therefore recommend mass vaccination. We also note a vaccination does not prevent polio. Your best protection is to get vaccinated and encourage everyone to be vaccinated.

Can you trust statistics? 10 A Statistician’s Job Understand the problem. This requires an interaction with subject specialists and often a basic understanding of their science. Design experiments so something can be proved. Statistics is huge so somebody may already have a design. Surprisingly often you have to find a new approach.

Can you trust statistics? 11 A Statistician’s Job Ensure the data is collected according to the design. Use probability and computers to calculate the significance of the results. Draw a conclusion and explain it.

Can you trust statistics? 12 Statistical Careers SOA Society of actuaries CAS Casualty Actuarial Society Examination:1/P: essentially MAT2371 Qualify for VEE-Applied Statistical Methods: essentially MAT2375

Can you trust statistics? 13 Statistical Careers Statistics Canada methodologist: Our courses in statistics are accredited by the Canadian Statistical Society so if you take the recommended courses you are ready to take the civil service examination

Can you trust statistics? 14 Statistical Careers Defense research board – data mining of surveillance data Ministry of Transport – analyzing accidents Ministry of Agriculture – forecasting Bank of Canada, Finance - forecasting

Can you trust statistics? 15 Statistical Careers Quant – modeling and forecasting markets Hedgie - calculating complex trading strategies like calls and puts – lots of probability