Mike's Reviews > The Drunkard's Walk: How Randomness Rules Our Lives

The Drunkard's Walk by Leonard Mlodinow
Rate this book
Clear rating

by
1829065
's review
Dec 29, 11

really liked it

Almost completely rewriting this. I'm not changing my rating; this really is a great book on an important subject. Random phenomenon are everywhere, and humans don't understand them well. We're not wired to understand them well. This book is a huge help, and will be a relief to anyone who's heard people say "Well, I don't believe in global warming because last winter we got a lot of snow," or some load of crap like that. It's well written; there's a lot of storytelling; the storytelling fun and interesting. Along the way it gives coherent explanations of Bayes' theorem, the Monty Hall problem (simplest correct explanation I've ever seen), the origins of statistics and more. If you want an excellent non-mathematical introduction to probabilistic thinking, this is the book to get.

But there's always a but. But, but, but...

I have two problems with this book. They've been nagging me ever since I finished.

First, Mlodinow spends a lot of time debunking the notion of "hot streaks." He's right, and that's important: most hot streaks in sports and elsewhere can be adequately explained by randomness. Randomness is inherently streaky and clumpy; it's not just a smooth gray. In fact, if you get something that looks smooth and "random," it's almost certainly not random. So far, so good. BUT--when he moves from Roger Maris' record-breaking season to portfolio managers picking hot stocks, there's a fundamental asymmetry. With Maris, the author starts with the long-term batting average. We're not just "flipping coins"; we're flipping a weighted coin, a coin that happens to land with the "home run" side facing up a lot frequently than it would if I were in the batter's box. That's all well and good; if I faced a season's worth of professional baseball pitching, I daresay I wouldn't get a single hit, let alone any home runs. But--and this is important--he doesn't do the same for the stock pickers, book acquisition editors, or Hollywood movie execs that he talks about. For them, it's just flipping coins. And it's one thing to say that, if you just flipped coins for 10 years, you'd have a 75% chance of duplicating a great financial manager's performance. It's another thing to imply that the manager's performance is just a matter of luck, not skill. Yes, there is a lot of luck involved, but where's the notion of baseline performance, of long term success or failure, that was the starting point for analyzing Maris' hot year? Maris' hot year may have been a random phenomenon, but it was a random phenomenon in the context of a lifetime .358 batting average. What's the stock picker's lifetime batting average? We never find out. And that's a big part of the story to omit.

Second, he frequently forgets one of the most important aspects of the mathematical study of random processes. When we're talking probability and statistics, we're talking about interchangeable events. It's easy to forget this, but as Mlodinow himself points out, there are many, many ways to make important mistakes when you're talking about probability. The important thing about urns with black and white balls is that the balls are the same. (If you don't know about urns, take a probability course or read the book; they're baked into the history of probability theory.) If some of the balls were ovals and some were star-shaped, these probability experiments wouldn't work. So, back again to the stock pickers, the acquisitions editors, and the Hollywood execs. We agree at some level that all at-bats in baseball are equivalent. This is, of course, an idealization, but it's one we're fairly comfortable with. But all stocks are NOT the same, all books are NOT the same, and all movies are NOT the same. They may be the same within a certain class (energy stocks, cheap romance novels, spy movies). A stock analyst who's good with financials may have nothing to say about manufacturing. But at the high end of the spectrum (literary novels, fine wines, art movies), everything is unique, precisely in a way that Harlequin romances aren't. Probability and statistics are still powerful tools, but you have to be very careful about how you apply them.

Since I'm in the publishing business, I'm particularly annoyed by the story of an editor who, in an experiment, was given a typewritten chapter of a V. S. Naipaul novel that had won a major award. She rejected it. I'm not a fan of Naipaul, so I'm sympathetic. But is that evidence of her editorial skill (or lack thereof), or of random processes? Since we're now in a world where every event is unique we have to ask more questions: what publisher was she working for? Grove Press, which publishes top drawer literary fiction with a tendency towards the avant garde (for whom Naipaul might have been too stodgy)? Or Bantam, which specialized in lightweight beach-side reading? In both cases, a rejection would have been perfectly appropriate. Probability aside, it's a cheap shot to say "Because this book won a major award, we'd expect editors at a publishing company to accept it. If they don't, that's evidence that publishing is a random process." Publishing (and movies, and wines, and maybe even stocks) are a different world, and the disagreements are precisely what is important. Modelling disagreement as random fluctuation isn't doing anyone a service. I may dislike Naipaul's fiction, but I hardly see that as a random result. We could ask about the conditional probability that an English major will dislike Naipaul, given that he has plays piano, has a strong background in Electrical Engineering and Mathematics, and likes Rushdie, and come up with some sort of number, but I'd have no idea what that number means. We're not picking black and white balls out of urns here--or if we are, the balls are of different shapes and sizes.

Am I just going back to the human tendency to build stories where there is nothing but randomness? Am I just refusing to deal with the stark realities of random phenomenon that surround us everywhere? Perhaps. Then again, that's what makes us human. And in the many situations where probability and statistics aren't appropriate tools, such as picking books or movies, then all we have to fall back on is our ability to make stories, our ability to make sense. Where "make" is precisely the most important word in that last sentence.
flag

Sign into Goodreads to see if any of your friends have read The Drunkard's Walk.
Sign In »

No comments have been added yet.