Richard Stone quote: “A choice may have to be made between a biased estimator which is believed to be relatively accurate and an unbiased est…”

“In recent years there has been increased interest in the effects of internal communication on decision processes. A number of hypotheses relating the bias in information to the final decision have been proposed. In this paper we discuss two laboratory experiments which were designed to test two such hypotheses. The first experiment tests the hypothesis that cost and sales estimations are made with the implicit assumption that a biased pay-off structure exists. The second experiment tests explicitly the effects of biased and unbiased pay-off structures on estimation within an organization. An analysis of the data for the two experiments is made and some implications for further research are drawn from the results.”

Richard Cyert (1921–1998) American economist

Richard Cyert, James G. March, William H. Starbuck. (1961) "Two experiments on bias and conflict in organisational estimation," Management Science, 254–64; Abstract

“In recent years there has been increased interest in the effects of internal communication on decision processes. A number of hypotheses relating the bias in information to the final decision have been proposed. In this paper we discuss two laboratory experiments which were designed to test two such hypotheses. The first experiment tests the hypothesis that cost and sales estimations are made with the implicit assumption that a biased pay-off structure exists. The second experiment tests explicitly the effects of biased and unbiased pay-off structures on estimation within an organization. An analysis of the data for the two experiments is made and some implications for further research are drawn from the results.”

William H. Starbuck (1934) American academic

Richard Cyert, James G. March, William H. Starbuck. (1961) "Two experiments on bias and conflict in organisational estimation," Management Science, 254–64; Abstract

“In recent years there has been increased interest in the effects of internal communication on decision processes. A number of hypotheses relating the bias in information to the final decision have been proposed. In this paper we discuss two laboratory experiments which were designed to test two such hypotheses. The first experiment tests the hypothesis that cost and sales estimations are made with the implicit assumption that a biased pay-off structure exists. The second experiment tests explicitly the effects of biased and unbiased pay-off structures on estimation within an organization. An analysis of the data for the two experiments is made and some implications for further research are drawn from the results.”

James G. March (1928–2018) American sociologist

Richard Cyert, James G. March, William H. Starbuck. (1961) "Two experiments on bias and conflict in organisational estimation," Management Science, 254–64; Abstract

“In the second place, a system would involve more variables than those which may be supposed to enter into demand relationships, and so the preliminary work of estimating the necessary time series would also be increased. In the third place, in the simultaneous method of estimation the estimates of the original parameters come to depend on most of the remaining estimates, and so it is quite likely that they will have large sampling variances.”

Richard Stone (1913–1991) British economist, Nobel Memorial Prize winner

Studies in the National Income and Expenditure of the United Kingdom, 1954

“If we lavishly and boldly push forward in the creation and distribution of our riches, it is hard to over-estimate the pitch of beneficial influence to which we may attain in the present. But the maintenance of such a position is physically impossible. We have to make the momentous choice between brief greatness and longer continued mediocrity.”

William Stanley Jevons book The Coal Question

The Coal Question (1865)
Context: The alternatives before us are simple. Our empire and race already comprise one-fifth of the world's population, and by our plantation of new states, by our guardianship of the seas, by our penetrating commerce, by the example of our just laws and firm constitution, and above all by the dissemination of our new arts, we stimulate the progress of mankind in a degree not to be measured. If we lavishly and boldly push forward in the creation and distribution of our riches, it is hard to over-estimate the pitch of beneficial influence to which we may attain in the present. But the maintenance of such a position is physically impossible. We have to make the momentous choice between brief greatness and longer continued mediocrity.

“There is no golden mean between these two extremes; either this early life must become low in our estimation, or it will have our inordinate love.”

John Calvin (1509–1564) French Protestant reformer

Page 70.
Golden Booklet of the True Christian Life (1551)

“The question of the size of the postwar population of the Soviet Union is not the least of the enigmas which have been baffling students of Russian affairs. Hardly any estimate or evaluation of an economic, sociological or military character for the U. S. S. R. can be made meaningful without an accurate knowledge of the demographic base.”

Eugene M. Kulischer (1881–1956) American sociologist

Kulischer (1949) "The Russian Population Enigma". in: Foreign affairs. Vol 27. April 1949. p. 497

“To estimate the value of Newton's discoveries, or the delight communicated by Shakespeare and Milton, by the price at which their works have sold, would be but a poor measure of the degree in which they have elevated and enchanted their country; nor would it be less grovelling and incongruous to estimate the benefit which the country has derived from the Revolution of 1688, by the pay of the soldiers, and all other payments concerned in effecting it.”

Thomas Robert Malthus Principles of Political Economy

Book I, Chapter I, Of The Definitions of Wealth and of Productive Labour, Section II, p. 49
Principles of Political Economy (Second Edition 1836)

“For reasons mathematical, psychological, and sociological, it is a good idea to use a money management system that is relatively forgiving of estimation errors.”

William Poundstone (1955) American writer

Part Six, Blowing Up, Survival Motive, p. 296-297
Fortune's Formula (2005)

“Between these two currents, always manifesting themselves, always at grips with each other — the popular trend and that which thirsts for political and religious domination — we have made our choice.”

Peter Kropotkin (1842–1921) Russian zoologist, evolutionary theorist, philosopher, scientist, revolutionary, economist, activist, geogr…

Source: The State — Its Historic Role (1897), X
Context: Throughout the history of our civilization, two traditions, two opposing tendencies have confronted each other: the Roman and the Popular; the imperial and the federalist; the authoritarian and the libertarian. And this is so, once more, on the eve of the social revolution.
Between these two currents, always manifesting themselves, always at grips with each other — the popular trend and that which thirsts for political and religious domination — we have made our choice.
We seek to recapture the spirit which drove people in the twelfth century to organise themselves on the basis of free agreement and individual initiative as well as of the free federation of the interested parties. And we are quite prepared to leave the others to cling to the imperial, the Roman and canonical tradition.

“A choice may have to be made between a biased estimator which is believed to be relatively accurate and an unbiased estimator which is demonstrably highly inefficient, and it is by no means obvious that the latter is always to be preferred.”

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