IDEAS home Printed from https://ideas.repec.org/a/taf/amstat/v71y2017i3p209-219.html
   My bibliography  Save this article

Statistical Engineering: An Idea Whose Time Has Come?

Author

Listed:
  • Roger W. Hoerl
  • Ronald D. Snee

Abstract

Several authors, including the American Statistical Association (ASA) guidelines for undergraduate statistics education (American Statistical Association Undergraduate Guidelines Workgroup), have noted the challenges facing statisticians when attacking large, complex, and unstructured problems, as opposed to well-defined textbook problems. Clearly, the standard paradigm of selecting the one “correct” statistical method for such problems is not sufficient; a new paradigm is needed. Statistical engineering has been proposed as a discipline that can provide a viable paradigm to attack such problems, used in conjunction with sound statistical science. Of course, to develop as a true discipline, statistical engineering must be clearly defined and articulated. Further, a well-developed underlying theory is needed, one that would prove helpful in addressing such large, complex, and unstructured problems. The purpose of this expository article is to more clearly articulate the current state of statistical engineering, and make a case for why it merits further study by the profession as a means of addressing such problems. We conclude with a “call to action.”

Suggested Citation

  • Roger W. Hoerl & Ronald D. Snee, 2017. "Statistical Engineering: An Idea Whose Time Has Come?," The American Statistician, Taylor & Francis Journals, vol. 71(3), pages 209-219, July.
    • Handle: RePEc:taf:amstat:v:71:y:2017:i:3:p:209-219
    DOI: 10.1080/00031305.2016.1247015
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/00031305.2016.1247015
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/00031305.2016.1247015?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Robert C. Merton, 2005. "Theory of rational option pricing," World Scientific Book Chapters, in: Sudipto Bhattacharya & George M Constantinides (ed.), Theory Of Valuation, chapter 8, pages 229-288, World Scientific Publishing Co. Pte. Ltd..
    2. Davit Khachatryan, 2015. "Incorporating Statistical Consulting Case Studies in Introductory Time Series Courses," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 387-396, November.
    3. Nathan Tintle & Beth Chance & George Cobb & Soma Roy & Todd Swanson & Jill VanderStoep, 2015. "Combating Anti-Statistical Thinking Using Simulation-Based Methods Throughout the Undergraduate Curriculum," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 362-370, November.
    4. J. Hardin & R. Hoerl & Nicholas J. Horton & D. Nolan & B. Baumer & O. Hall-Holt & P. Murrell & R. Peng & P. Roback & D. Temple Lang & M. D. Ward, 2015. "Data Science in Statistics Curricula: Preparing Students to “Think with Data”," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 343-353, November.
    5. Garrett Grolemund & Hadley Wickham, 2014. "A Cognitive Interpretation of Data Analysis," International Statistical Review, International Statistical Institute, vol. 82(2), pages 184-204, August.
    6. Meng, Xiao-Li, 2009. "Desired and Feared—What Do We Do Now and Over the Next 50 Years?," The American Statistician, American Statistical Association, vol. 63(3), pages 202-210.
    7. Shonda Kuiper & Rodney X. Sturdivant, 2015. "Using Online Game-Based Simulations to Strengthen Students’ Understanding of Practical Statistical Issues in Real-World Data Analysis," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 354-361, November.
    8. C. J. Wild & M. Pfannkuch, 1999. "Statistical Thinking in Empirical Enquiry," International Statistical Review, International Statistical Institute, vol. 67(3), pages 223-248, December.
    9. Scott D. Grimshaw, 2015. "A Framework for Infusing Authentic Data Experiences Within Statistics Courses," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 307-314, November.
    10. Nicholas Chamandy & Omkar Muralidharan & Stefan Wager, 2015. "Teaching Statistics at Google-Scale," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 283-291, November.
    11. Hoerl, Roger W. & Snee, Ronald D., 2010. "Moving the Statistics Profession Forward to the Next Level," The American Statistician, American Statistical Association, vol. 64(1), pages 10-14.
    12. George Cobb, 2015. "Mere Renovation is Too Little Too Late: We Need to Rethink our Undergraduate Curriculum from the Ground Up," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 266-282, November.
    13. Ben Baumer, 2015. "A Data Science Course for Undergraduates: Thinking With Data," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 334-342, November.
    14. Deborah Nolan & Duncan Temple Lang, 2015. "Explorations in Statistics Research: An Approach to Expose Undergraduates to Authentic Data Analysis," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 292-299, November.
    15. Byran J. Smucker & A. John Bailer, 2015. "Beyond Normal: Preparing Undergraduates for the Work Force in a Statistical Consulting Capstone," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 300-306, November.
    16. Jennifer L. Green & Erin E. Blankenship, 2015. "Fostering Conceptual Understanding in Mathematical Statistics," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 315-325, November.
    17. Black, Fischer & Scholes, Myron S, 1973. "The Pricing of Options and Corporate Liabilities," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 637-654, May-June.
    18. Nicholas J. Horton & Johanna S. Hardin, 2015. "Teaching the Next Generation of Statistics Students to “Think With Data”: Special Issue on Statistics and the Undergraduate Curriculum," The American Statistician, Taylor & Francis Journals, vol. 69(4), pages 259-265, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nuno Costa & Paulo Fontes, 2020. "Energy-Efficiency Assessment and Improvement—Experiments and Analysis Methods," Sustainability, MDPI, vol. 12(18), pages 1-19, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Amy L. Phelps & Kathryn A. Szabat, 2017. "The Current Landscape of Teaching Analytics to Business Students at Institutions of Higher Education: Who is Teaching What?," The American Statistician, Taylor & Francis Journals, vol. 71(2), pages 155-161, April.
    2. Kau, James B. & Keenan, Donald C., 1999. "Patterns of rational default," Regional Science and Urban Economics, Elsevier, vol. 29(6), pages 765-785, November.
    3. Carol Alexandra & Leonardo M. Nogueira, 2005. "Optimal Hedging and Scale Inavriance: A Taxonomy of Option Pricing Models," ICMA Centre Discussion Papers in Finance icma-dp2005-10, Henley Business School, University of Reading, revised Nov 2005.
    4. Jun, Doobae & Ku, Hyejin, 2015. "Static hedging of chained-type barrier options," The North American Journal of Economics and Finance, Elsevier, vol. 33(C), pages 317-327.
    5. Vorst, A. C. F., 1988. "Option Pricing And Stochastic Processes," Econometric Institute Archives 272366, Erasmus University Rotterdam.
    6. Antoine Jacquier & Patrick Roome, 2015. "Black-Scholes in a CEV random environment," Papers 1503.08082, arXiv.org, revised Nov 2017.
    7. Boyarchenko, Svetlana & Levendorskii[caron], Sergei, 2007. "Optimal stopping made easy," Journal of Mathematical Economics, Elsevier, vol. 43(2), pages 201-217, February.
    8. Robert C. Merton, 2006. "Paul Samuelson and Financial Economics," The American Economist, Sage Publications, vol. 50(2), pages 9-31, October.
    9. Ammann, Manuel & Kind, Axel & Wilde, Christian, 2003. "Are convertible bonds underpriced? An analysis of the French market," Journal of Banking & Finance, Elsevier, vol. 27(4), pages 635-653, April.
    10. Sergio Zúñiga, 1999. "Modelos de Tasas de Interés en Chile: Una Revisión," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 36(108), pages 875-893.
    11. Zhijian (James) Huang & Yuchen Luo, 2016. "Revisiting Structural Modeling of Credit Risk—Evidence from the Credit Default Swap (CDS) Market," JRFM, MDPI, vol. 9(2), pages 1-20, May.
    12. José Martins & Rui Cunha Marques & Carlos Oliveira Cruz & Álvaro Fonseca, 2017. "Flexibility in planning and development of a container terminal: an application of an American-style call option," Transportation Planning and Technology, Taylor & Francis Journals, vol. 40(7), pages 828-840, October.
    13. Marcelo F. Perillo, 2021. "Valuación de Títulos de Deuda Indexados al Comportamiento de un Índice Accionario: Un Modelo sin Riesgo de Crédito," CEMA Working Papers: Serie Documentos de Trabajo. 784, Universidad del CEMA.
    14. Kartono, Agus & Solekha, Siti & Sumaryada, Tony & Irmansyah,, 2021. "Foreign currency exchange rate prediction using non-linear Schrödinger equations with economic fundamental parameters," Chaos, Solitons & Fractals, Elsevier, vol. 152(C).
    15. Jochen Bigus, 2002. "Investitionsanreize, Koalitionsverhalten und Gläubigerkonflikte," Schmalenbach Journal of Business Research, Springer, vol. 54(4), pages 317-342, June.
    16. Kim, Amy M. & Li, Huanan, 2020. "Incorporating the impacts of climate change in transportation infrastructure decision models," Transportation Research Part A: Policy and Practice, Elsevier, vol. 134(C), pages 271-287.
    17. René Garcia & Richard Luger & Eric Renault, 2000. "Asymmetric Smiles, Leverage Effects and Structural Parameters," Working Papers 2000-57, Center for Research in Economics and Statistics.
    18. Wang, Jun & Liang, Jin-Rong & Lv, Long-Jin & Qiu, Wei-Yuan & Ren, Fu-Yao, 2012. "Continuous time Black–Scholes equation with transaction costs in subdiffusive fractional Brownian motion regime," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 391(3), pages 750-759.
    19. George W. Kutner & James A. Seifert, 1989. "The Valuation of Mortgage Loan Commitments Using Option Pricing Estimates," Journal of Real Estate Research, American Real Estate Society, vol. 4(2), pages 13-20.
    20. Hilscher, Jens & Raviv, Alon, 2014. "Bank stability and market discipline: The effect of contingent capital on risk taking and default probability," Journal of Corporate Finance, Elsevier, vol. 29(C), pages 542-560.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:amstat:v:71:y:2017:i:3:p:209-219. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/UTAS20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.