NO I’m not PSYCHIC
Ever conscious minute of the day or night we all make bad or good decisions about what is about to happen.
I should say we attempt to predict what others are likely to do based upon what we think we have identified as repeating patterns of behaviour.
For example, the Los Angeles police department are using data to predict where crimes are likely to happen with the intention of either preventing or arresting the perpetrators. The police achieve this by analysing very large data sets to reveal patterns of behaviour.
Think of it this way
Individually we are likely to know how members of the family or friends are likely to behave in a given situation.
For example, a husband takes his wife out to dinner. He thinks if he tells her the table is booked for 7:30 she is likely to be ready to leave their home around 7:30 as she always takes’ her time when preparing herself to go out for the evening.
To prevent arguments, he books the table for 8:30. He knows if they leave at 7:30 they will be sufficiently time to travel to the restaurant. His wife knows his pattern of behaviour so she chooses to not hurry herself.
Predicting human behaviour can make you MONEY
Humans tend to be rather good at predicting behaviour when individuals know each other. However, we are far less effective when making sense of people we do not know or when analysing large data sets.
Real World examples
Professor Hans Rosling’s, Gap Minder organisation collaborating with the Open University and the BBC made a series of very entertaining ‘Don’t panic themed programs illustrating how data can be used to predict the future by identifying repeating behavioural patterns. If you haven’t seen these programs I recommend you do. Click here…
Sharad Goel and colleagues put forward a hypothesis that we seek information online to aid decision making.
For example, we research films we may like to see and possibly restaurants we might choose to visit afterwards. Goel et al. viewed internet data such as films, songs, and games people had been looking for online and showed the data could forecast the rankings and revenues of films, songs, and games the following week. If you use the search data to build a predictive data model, it’s possible to improve predictions as to which films and songs and games are going to be popular the next week.