Substack cometh, and lo it is good. (Pricing)

Range restriction always looms

Scatterplot_r=-.76The correlation between medical school GPA and career outcomes is low. The correlation between height and number of all-star appearances in the NBA is low. The correlation between SAT score and performance as a Google engineer is low.

Actually, I don’t know if all of these are strictly true. But I think you’ve seen the general form of the fact. So, for example, a professor I knew once recounted that at his graduate institution they once looked at correlation between GRE scores and future positions at tenure track institutions. They didn’t find any association.

51sdHZvYfTL._SX334_BO1,204,203,200_ (1)But there was a problem here: the institution was one of the top 10 graduate programs in the country in the biological sciences. The GRE scores were likely to be very high already. The result reported is certainly correct. But the inference given toward a general audience is often misleading. The correct inferences is within a particular range of the independent variable the correlation between the variable (here, GRE score) and an outcome (here, a tenure track position) is low. But what is often inferred is that there is no relationship between a variable and an outcome. Period. This is usually an incorrect inference.

One reason I’m putting this post up is a blogpost I noticed, Google Finds That Successful Teams Are About Norms Not Just Smarts. It links to The New York Times Magazine article which outlined how Google had attempted to find the “perfect” makeup of a team. The title is key here: not just. Most people who get to interview at Google are very bright. They aren’t arbitrary people pulled off the street. That’s one reason that the old Google system might have been counter-productive, since you already knew that the people you were testing were good at taking tests, as opposed to gauging them on other personal characteristics (e.g., do they have social skills which might allow them to work well on a team?).

Norms matter a lot. Isaac Newton’s father was an unlettered (if prosperous) farmer. If Newton had been born a few hundred years earlier he would not have flourished as he did. Norms matter. Culture matters. But not all men are born Isaac Newtons. Aptitude matters too. When we observe that norms and culture matters in the context of genius we are often engaging in range restriction. The individuals who illustrate the power of culture are not arbitrarily selected from the whole population.

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