The Signal and the Noise: Why So Many Predictions Fail--But Some Don't
Statistics, cognitive psychology
The Signal and the Noise is a user's manual about how to make better decisions with imperfect information. As is often the case, the people who would benefit most from the book are the ones who are least likely to read it, or to believe it if they do.
It turns out that foxes make better predictions than hedgehogs, that thinking in terms of probability is really important, that people who refuse to apply mathematics often talk hooey, that self-proclaimed "experts" often aren't, and that it pays never to be too certain of your initial assumptions. This book, in fact, confirmed all of my prejudices.
Therefore, it's obviously wonderful.
Put that way, it sounds stupid. And yet this is one of Nate Silver's (and others') key findings: we all think that way. The difference is that truly rational people know that they're not rational--and factor that into their thinking. Put another way, one of the most important sources of human error is to look at the data with an eye towards confirming your own biases: in real-world data, there's usually enough noise clouding the signal that a determined eye can pick out a false pattern from it.
The book doesn't put great mathematical demands on the reader, although in fact basic probability and statistics don't require much beyond high-school algebra. There are a good many charts and graphs, which are clear and easily understandable. The book is written in straightforward, entertaining, clear, and fluent prose. It perhaps loses a little steam towards the end, where Silver chooses to multiply examples rather than honing his conclusions. Aside from that nitpick, I'd recommend The Signal and the Noise to anyone who wants to be a better thinker, which I assume includes anyone who's read this far.
Pairs well with Daniel Kahneman's Thinking Fast and Slow or Dubner and Leavitt's Freakonomics.