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  • Matthew Kaufman

The Science of Determining Your Future

Sabermetrics being used to determine outcomes of baseball games is just the beginning of a statistical revolution.

If you’ve ever seen the 2011 movie Moneyball you might have been amazed by how something like mathematics and statistics could take over baseball. After all, not only did it take over America’s favorite past time, but it presented to many people, this idea that something so mundane could have an impact on some of the world’s biggest stages. If you think that’s where the power of this all ends, then you’re sorely mistaken.

Should you work in any field that handles insurance of any variety, then you might already be aware of how much statistics determines peoples’ lives. The driver is under a certain age, the car has a manual transmission, even something as trivial as the color of a car can and will most likely be used to create one number that you will then have to pay for your auto insurance. But how does this all work? Better yet, why does it work?

As a primer, let me introduce you to the crazy field of actuarial science. Despite its funny name, actuarial science itself is not funny. Actuarial science is when the field of mathematics that applies various methods to factor in risk, finance, and other information to determine many things in your life. It is this massive hodge podge of topics, mixing traditional mathematics, probabilities, statistics, finance, economics, and even computer science that when combined form this magical power of predicting the most likely future.

I’m sure we all know some of the weird facts that we’ve heard from those involved in insurance about how things that we think should be completely unrelated can actually have an impact on a person’s payment rates. But when you start viewing this in a calculating manner, it all starts to click. If there is 100 car wrecks a year and 80 of them all involve black cars, then you’d start to suspect that the color of the car is part of the reason that these accidents are happening. While you can’t exactly say that the color is the cause of the accident, you can most likely assume there is some kind of correlation between the color of a car and the likelihood that the car will be involved in an accident. Now let’s also say that of those 100 incidents, that 72 of them all come from a car manufacturer. So a black car from that manufacturer would seem like a bad choice if you enjoy not getting into car accidents. This, at a very simplistic level, is how actuarial science actually works. Actuarial science takes all of these weird facts and numbers, crunches them together, and then determines your likelihood for an event happening.

How far does this all reach though? In recent history, actuarial science has even been reaching so far to even have a hand in our justice system. Whether you agree with their usage or the possibly racial implications of the models being used, there are many places looking to use this power of knowing the future to figure out how they should allocate resources. But to offer another movie as a counterpoint, doesn’t this almost start to sound like Minority Report? Doesn’t predicting the future lead into the possibility of creating self-fulfilling prophecies?

After all, if we begin treating someone like a criminal long before they commit the crime, then won’t we inadvertently be putting them exactly on the path to commit a crime? Doesn’t this all start to sound like someone trying to hide behind mathematics

to justify their discriminatory behavior? But in the same breath, should we be letting emotions rule over science, or doesn’t that lead into its own horrifying dystopia where we veer away from mathematics and science because we are afraid of what it says?

Ultimately, this all lends itself back to a core thought of free will versus determinism. Should we take action based upon the most statistically likely to happen events or should we be focusing on embracing free will? Does a world that uses nothing but statistics to determine the future look like the colors of a utopia or a dystopia? Where should the line stand when it comes to the ethical and social implications of trying to implement things like this? At the end of the day, whether we have the answers or not on how we should be using actuarial science, it is slowly bleeding into our lives more and more. From the sports we watch on television, to the cars we drive, the jobs we work, and everything else, there is a science that is lurking in the shadows, attempting to divine and scry our futures.