Statistics M11/Economics 40
Lecture 1

INTRODUCTION

A. Overview

Statistics is the science of collecting, presenting, and interpreting data to answer questions. There are four basic issues:

1. Determining the question and what data are of interest.

2. Collecting the data.

3. Summarizing the data graphically and numerically.

4. Making generalizations from the data and drawing conclusions.

B. Determining the Question

1. The first issue in statistics is always, "What question do we want to answer?"

2. Data do not speak for themselves. They must be gathered purposefully.

3. Not all questions can be answered!

a. "Data as they are" questions can be answered:

How many Americans filed for first-time unemployment claims last week?

 

b. "What-if questions under replicable circumstances" can be answered:

If I use this new cologne will it work as they claim it should? The crazy e-mail your professor gets

c. Data from nonreplicable events, in general, can NOT be answered!

In other words some questions have no answers.

"How large would the 1998 money supply be if the American Revolution failed?"

 

C. Collecting Data

Ask, is it being collected in an intelligent manner. There are always problems with measurement.

 

D. Examples

1. Guessing

Ask yourself is this a reasonable guess? It is a bad guess? When someone guessing or speculating, you should question the sources of data. Is the researcher doing his or her job well?

2. Anecdotes -- Journalists LOVE anecdotes. But so do salespeople (e.g. "it worked for my friend, it will work for you too").

Last Update: 1 October 1999 by VXL