Posted by – June 17, 2014

One website I visit repeatedly is the New York Times’ Upshot blog, edited by David Leonhardt, because I find its graphical analysis of politics and economics help me think and understand. For example, they take a look at the monthly employment statistics that are often cited as economic indicators, and show that the typical level of randomness in monthly jobs numbers masks the underlying trend. They illustrate this using an animated simulation of random errors added to an average or a trend – i.e., a Monte Carlo simulation of jobs numbers – showing how easy it is to be fooled by randomness. The Upshot’s interactive forecasting model of the upcoming Senatorial elections, created by Amanda Cox and Josh Katz, is also worth a look.

Monte Carlo Simulation of Jobs data