Thursday, October 14, 2004

More biased sampling

A writer once decided to write a book about how self-made millionaires did it. He used his contacts to find a sample of self-made millionaires and fourteen of them agreed to tell him how they made their money starting from essentially nothing. He cleaned up the interviews a little and put them together into a book. He recommended their methods as ways for others to make money. The book turned into an easy $15,000 for him, once the royalties came in.

When I read the book I noticed that every one of those men had, early in the game, done something that was likely to get them jailed and they got away with it.

To actually get an idea how likely those methods were to make money, the author should have started with a bunch of people just like the self-made men and watched how many of them became millionaires versus how many of them became inmates. He was only counting the ones who made it.

Of course it's impractical to do that kind of study. That's why such books give mosty-useless advice.


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