What on Earth is Simpson’s Paradox? How Does it Affect Data?

Simpson’s paradox is a phenomenon in probability and statistics, in which a trend appears in different groups of data, but disappears or reverses when these groups are combined.
You need to be very careful while calculating averages or pooling data from different sectors. It is always better to check whether the pooled data tell the same story or a different one from that of the non-aggregated data. If the story is different, then there is a high probability of Simpson’s paradox. A lurking variable must be affecting the direction of the explanatory and target variables.

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Historical Background

Simpson’s Paradox was discovered in the early twentieth century, with contributions from various statisticians and scholars. In 1951, Edward H. Simpson, a British statistician, found one of the earliest prominent examples. However, the paradox itself had been observed in various forms even before Simpson’s work.

Simpsons Paradox refers to a phenomenon in which an apparent trend or relationship in aggregated data reverses or disappears when the data is disaggregated into subgroups. If not fully understood and accounted for, this surprising discovery might lead to incorrect findings.

Consider the famous Simpson’s Paradox example to gain a better understanding of the dilemma it presents. Assume two departments, A and B, at a university and the goal is to compare their respective acceptance rates of male and female candidates. On a surface analysis of the aggregated data, it appears that Department A has a higher admittance rate for both males and females than Department B; however, when we break down the data by gender, we see that while Department A has a higher admittance rate for both genders, Department B actually has a lower rate for each gender combined. This trend reversal at the subgroup level is an example of Simpson’s Paradox.

Real-world Applications

Simpson’s Paradox has far-reaching implications and has been observed in various domains, including social sciences, healthcare, education, economics, and sports. Understanding this Simpson’s paradox in data science is crucial for avoiding misinterpretation of data and making accurate decisions.

In the field of healthcare, Simpson’s Paradox has been encountered in studies evaluating the effectiveness of treatments. For instance, a drug may show positive effects overall but fail to demonstrate efficacy when the data is analyzed based on different patient characteristics or disease severity levels. This highlights the importance of considering subgroup analyses to gain a comprehensive understanding of treatment outcomes.

In economics, Simpson’s Paradox can occur when analyzing income inequality across different regions or demographic groups. Aggregated data may suggest a decreasing income gap, but disaggregating the data could reveal that inequality actually worsens within each subgroup. This emphasizes the need to examine data from various perspectives to avoid overlooking underlying patterns.

Preventive Measures

To circumvent Simpson’s Paradox and guarantee precise study and analysis, researchers and investigators ought to take several preventive steps. First and foremost, it is essential to perform a subgroup analysis. By closely observing the data at the subgroup level, subtleties in the underlying connections can be exposed. This allows for a more astute understanding of the data and helps uncover potential confounding variables or interaction effects that can contribute to the paradox. Additionally, the sample size must be taken into account. Adequate sample sizes within subgroups are essential to obtain dependable and statistically substantial outcomes. Insufficient sample sizes can cause illogical determinations and exacerbate the odds of experiencing Simpson’s Paradox.

Contextual data is another significant factor to bear in mind. Understanding the exact setting in which the data was collected can help recognize conceivable predispositions and confounding factors. This data can then be incorporated into the analysis to offer a more exact elucidation of the discoveries. Lastly, by utilizing progressed factual techniques, such as multidimensional analysis and causal modeling, can give assistance to untangle the real connections between variables. These techniques permit distinguishing and controlling confounding factors, offering a stronger analysis.

By executing these preventive measures, researchers and analysts can minimize the danger of experiencing Simpson’s Paradox and enhance the accuracy and dependability of their discoveries. It is essential to approach data investigation with alertness and to consider the potential effect of subgroup results to guarantee logical choices in view of exact perceptions of the data.

Let us understand Simpson’s paradox with the help of an another example:
In 1973, a court case was registered against the University of California, Berkeley. The reason behind the case was gender bias during graduate admissions. Here, we will generate synthetic data to explain what really happened.

Let’s assume the combined data for admissions in all departments is as follows

If you observe the data carefully, you’ll see that 52% of the males were given admission, while only 43% of the women were admitted to the university. Clearly, the admissions favoured the men, and the women were not given their due. However, the case is not so simple as it appears from this information alone. Let’s now assume that there are two different categories of departments — ‘Hard’ (hard to get into) and ‘Easy’.

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Let’s divide the combined data into these categories and see what happens

Do you see any gender bias here? In the ‘Easy’ department, 62% of the men and 80% of the women got admission. Likewise, in the ‘Hard’ department, 26% of the men and 27% of the women got admission. Is there any bias here? Yes, there is. But, interestingly, the bias is not in favour of the men; it favours the women!!! If you combine this data, then an altogether different story emerges. A bias favouring the men becomes apparent. In statistics, this phenomenon is known as ‘Simpson’s paradox.’ But why does this paradox occur?

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Simpson’s paradox occurs if the effect of the explanatory variable on the target variable changes direction when you account for the lurking explanatory variable. In the above example, the lurking variable is the ‘department.’ In the case of the ‘Easy’ department, the percentages of men and women applying were in equal proportion. While in the case of the ‘Hard’ department, more women applied than men, and this led to more women applications getting rejected. When this data is combined, it shows a visible bias towards male admissions, which is really non-existent.

Now suppose you were a statistician for the Indian government and inspected a fighter plane that returned from the Chinese war of 1965. Inspecting the bullet holes in the aircraft surface, what would you recommend? Would you recommend the strengthening of the areas hit by bullets?

The following is an excerpt from a StackExchange

“During World War II, Abraham Wald was a statistician for the U.S. government. He looked at the bombers that returned from missions and analysed the pattern of the bullet ‘wounds’ on the planes. He recommended that the Navy reinforce areas where the planes had no damage.

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Why? We have selective effects at work. This sample suggests that damage inflicted on the observed areas could be withstood. Either the plane was never hit in the untouched areas — an unlikely proposition — or strikes to those parts were lethal. We care about the planes that went down, not just those that returned. Those that fell likely suffered an attack in a place that was untouched on those that survived.”

In statistics, things are not as they appear on the surface. You need to be skeptical and look beyond the obvious during analyses. Maybe it’s time to read ‘Think Like a Freak’ or ‘How to Think Like Sherlock’. Let us know if you already have and what your thoughts are on the same!