Wednesday, October 19, 2005

When Journalists Use Statistics It Gets Fugly.

We are doing some research right now on a recent RMN story about Colorado's "Achille's Heel." The story threw out a bunch of statistics, which, to the average reader probably looked quite impressive, but, look to us like garbage. Right now we are trying to do research (since the reporter's source also uses reams of garbage stats) that should answer if the statistics really are relevant.

What are we doing? We're looking at the rational behind the article, mainly that the cited "weaknesses" of Colorado have a correlation to negative economic growth, or just slower than average economic growth. Since both the News and the Source failed to give us either a correlation coefficient (which tells us if the statistic is even statistically significant) or a coefficient of determination (which tells us how much one variable explains about another) we will do it for you.

Our hypothesis: That the stats thrown out were garbage. That a state's state and local support for higher education, K-12 spending as a percent of personal income or high school graduation rates have no statistically significant correlation to either job creation, unemployment rate, GDP growth or personal income growth.

If you have any ideas tell us. Do you think that these rankings matter? Do you think that we should compare the state spending stats to another variable that would better measure the vitality of Colorado's economy?

The RMN Story is available here.

Reporter's Source.

Here is a gem from the article:

Here's what Colorado can report as strengths, the Metro Denver Economic Development Corp. found: Colorado is the fourth most highly educated state in percentage of college graduates and the 10th most productive work force by one measure. Property taxes for families, as well as overall business tax burden, are the second-lowest in the U.S.

And the state has the lowest obesity rate in the nation.

On the flip side, Colorado is 48th in state and local support for higher education and 49th in K-12 spending as a percent of personal income. While the population as a whole is well-educated - thanks to an influx of well-educated residents from other states - Colorado is 29th in high school graduation rates, down from 26th in 1995.

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