A sound grasp of basic statistical concepts is essential to have any hope of acquiring the mindset of a statistical thinker and to be able to use statistical methods. My introductory course “The 6 Concepts of Statistical Thinking” lays the foundations in the following.
- Probability – the difference between conditional & absolute probability.
- Risk – why it is an extension of probability and the importance of alpha (false positive) and beta (false negative) risk.
- Expectation – how to summarise a dataset into one number which measures its location.
- Variance – how to measure the spread of a dataset.
- Distribution – how to describe the shape of a dataset.
- Correlation – how to measure the relationship between two variables and understand the two golden rules of correlation.
Below is a list of resources to help improve your understanding of statistical concepts.
A. Summary Statistics
When we summarise a dataset, we are seeking to get a first impression of what it is telling us. We do this by calculating, tabulating and charting a variety of statistics that allows us to characterise its Location (Expectation), Spread (Variance) and Shape (Distribution).
The following posts are examples of summarising some well known datasets with the purpose of being able to place the latest data point in context.
- UK Weather tracker – summarises monthly weather variables in the UK.
- UK Economy tracker – summarises quarterly economic statistics in the UK.
When it comes to charting data, the most common charts people use in Excel are line, bar and scatter plots. In the latest version, Excel has finally added a feature to produce Box Plots which are really worth adding to your armoury. The following post shows the benefits of box plots.
- What are you expecting for your team this season? – Looks at the first 25 years of the English Premier League in football and what it takes to achieve certain outcomes.
B. Statistical Thinking & the Evidence Hierarchy
We all read about some latest research in the news. Should you pay attention to its results or not? What are the markers of a decent research project and what can be ignored? To help you with this, I came up with the concept of an Evidence Hierarchy or Circle and you can find out more by clicking this link.
C. Gender Pay Gaps
All organisations with 250 or more employees are now required to publish data on their gender pay gaps. Whilst I am supportive of the principle, I can see a myriad number of ways this data will be misused and misinterpreted through a lack of understanding of basic statistical concepts. Therefore I am blogging about gender pay gaps with the aim of improving people’s understanding and you can find all my blogs in the Diversity section of my blog.
The following posts within that section are especially relevant to understanding basic statistical concepts.
- What gender pay gap data tells us, what it doesn’t tell us and how it can be misused
- Three distinct errors that have been made by at least 10% of all organisations when submitting their gender pay gap data
- How to distinguish between a true pay gap and a pay gap that arises naturally due to the laws of chance
- My 12 steps to improve public confidence in gender pay gap data
- Calculate your gender pay gap by downloading my free spreadsheet calculator!
The 5th post is useful for seeing some basic formulae in Microsoft Excel.
D. The 9 Concepts of Statistical Thinking
My course “The 6 Concepts of Statistical Thinking” was first designed about 15 years ago. In that time, a lot of progress has been made in technology and in this article “The future of Statistical Thinking” published in Significance magazine in December 2014, I pondered whether or not I should change my course title to “The 9 Concepts of Statistical Thinking“.
E. Recommended Books
Here is a list of books I can recommend if you would like to improve your understanding of basic statistical concepts. All appear in my training courses.
- “Conned Again, Watson!” by Colin Bruce – Published in 2002, this is my all time favourite book on statistics. What Colin Bruce does is write Sherlock Holmes stories where Holmes is a statistician and detective. Some stories are little contrived but Bruce has done a great job of capturing the spirit of Conan Doyle’s books as well as illustrating a wide range of statistical and economic concepts.
- “Reckoning with Risk” by Gerd Gigerenzer – Published in 2002, I think it is a great shame that Gerd’s ideas on how to explain and present risk have not been taken up more widely. The human race can confuse itself terribly when it comes to risk especially when they are presented as probabilities and percentages. Gerd’s central insight is that numerical frequencies are much more likely to be understood and he writes about numerous examples of how this can be applied.
- “Thinking Fast & Slow” by Daniel Kahneman” – Published in 2011, this book explores in great depth why the human race is so poor at statistics. He backs his work with a huge range of experiments that have been undertaken to test this and I think you will find this very illuminating. It is a big book but it is worth persevering with.
F. Free online resources
I will add some links to useful resources at some point.