The Power of Experiments: Decision Making in a Data-Driven World
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- Create Date：2021-05-19 08:51:23
- Update Date：2025-09-07
- Status：finish
- Author：Michael Luca
- ISBN：0262542277
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Summary
How organizations--including Google， StubHub， Airbnb， and Facebook--learn from experiments in a data-driven world。
Have you logged into Facebook recently？ Searched for something on Google？ Chosen a movie on Netflix？ If so， you've probably been an unwitting participant in a variety of experiments--also known as randomized controlled trials--designed to test the impact of different online experiences。 Once an esoteric tool for academic research， the randomized controlled trial has gone mainstream。 No tech company worth its salt （or its share price） would dare make major changes to its platform without first running experiments to understand how they would influence user behavior。 In this book， Michael Luca and Max Bazerman explain the importance of experiments for decision making in a data-driven world。
Have you logged into Facebook recently？ Searched for something on Google？ Chosen a movie on Netflix？ If so， you've probably been an unwitting participant in a variety of experiments--also known as randomized controlled trials--designed to test the impact of different online experiences。 Once an esoteric tool for academic research， the randomized controlled trial has gone mainstream。 No tech company worth its salt （or its share price） would dare make major changes to its platform without first running experiments to understand how they would influence user behavior。 In this book， Michael Luca and Max Bazerman explain the importance of experiments for decision making in a data-driven world。
Reviews
nawaf
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My experience I liked the wide spectrum of examples covered by the writer。He gradually get you into the subject。My first ever English book。 Very good start for my readings。
Chelsea
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Solid introduction to the "why" of social experiments， including business。 Not really about the "how。" Had a lot of very familiar examples that are brought up in this realm a lot （Have you heard about eBay's advertising experiment？？？） but I thought it was decently-written， a rarity in business writing。 It was heavily focused on behavioral economic experiments， due to the popularity and the authors' background， I think， but I appreciated the point that these biases are often plucked out of their Solid introduction to the "why" of social experiments， including business。 Not really about the "how。" Had a lot of very familiar examples that are brought up in this realm a lot （Have you heard about eBay's advertising experiment？？？） but I thought it was decently-written， a rarity in business writing。 It was heavily focused on behavioral economic experiments， due to the popularity and the authors' background， I think， but I appreciated the point that these biases are often plucked out of their experimental context and thought of as universally applicable。 The chapter on AirBnb also was an interesting window into experimental resistance and ethics， but the authors did have a clear bone to pick on this。 Overall wish there had been more diversity of examples。 。。。more
Tran Ngan
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The book is fine enough。 It was more helpful when I apply this 'experiment' attitude mentioned in my real life。 How 'experiments' help me understand more about people around me， the choices I made and how can I make better decisions in the future :） The book is fine enough。 It was more helpful when I apply this 'experiment' attitude mentioned in my real life。 How 'experiments' help me understand more about people around me， the choices I made and how can I make better decisions in the future :） 。。。more
Jonas Hjalmar
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Budskapet skriver jag under på till 100 %: att experiment är det bästa （minst dåliga？） sättet att utveckla en verksamhet， oavsett det är offentlig eller privat sektor eller NGO's。 Men， framförandet är något repetitivt och blir mest en aptitretare inför den stora buffé som experimentella metoder innebär。Bazerman & Luca， båda två luttrade Business School-professorer， menar att vi är i en "experimentens revolution" där en mängd företag och organisationer nu kan samla in och analysera data på ett sä Budskapet skriver jag under på till 100 %: att experiment är det bästa （minst dåliga？） sättet att utveckla en verksamhet， oavsett det är offentlig eller privat sektor eller NGO's。 Men， framförandet är något repetitivt och blir mest en aptitretare inför den stora buffé som experimentella metoder innebär。Bazerman & Luca， båda två luttrade Business School-professorer， menar att vi är i en "experimentens revolution" där en mängd företag och organisationer nu kan samla in och analysera data på ett sätt som inte varit möjligt tidigare。 Det innebär att alla organisationer， inte bara tekniktunga som Google， Uber och Facebook （som oftast förknippas med experiment）， utan även regeringar och inte minst hälso- och sjukvård har mycket att vinna på att använda sina klienter/patienter/kunder som försökspersoner。 Givetvis inom det de etiska ramarna tillåter。 Boken innehåller tre delar。 En bakgrund till hur beteendeexperiment tog sig ur psykologi-labben， via brittiska regeringens Behavioral Insights Team， och vidare ut i världen。 Sedan en del med experiment i tech-sektorn， där eBay sparade $50 miljoner i marketing-budget， AirBnB stoppade strukturell rasism， och Facebook manipulerade användarnas välmående。 Till sist en del om att experimentera i sociala syften， och förbättrad hälsa och välstånd， där projektet "Behavior Change for Good" tar upp stor plats。Boken är alltså en slags case-samling över olika företag och organisationer som lyckats bra med att införa en experimentell approach。 Bra för chefer som vill få en övergripande koll på vad experiment kan innebära， eller de som vill övertyga sina chefer （eller kunder） om att experimentera mer。Boken är dock inte en beskrivning av hur man genomför experiment， det får man gå en PhD-utbildning för att få klarhet i。。。 。。。more
Christian
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This is a good intro to experimentation in tech。 The problem is that most people in tech are well-versed in experimentation。 They explain companies like Google， and older ones like Yahoo！ （？） to illustrate things we’ve known for a decade。 The book isn’t bad， it’s just woefully late。
Nilesh Makan
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I've been interested in behavioural economics of late。 This book is a great summary of the discipline of behavioural economics， and how this can be applied in business。 The focus is predominantly on the tech sector， mostly because it is this sector that， though technology， can run more experiments and collect the most amount of data through those experiments to test a hypothesis。 I thoroughly liked the way the book promoted that businesses should use experiments to aide decision making， but not I've been interested in behavioural economics of late。 This book is a great summary of the discipline of behavioural economics， and how this can be applied in business。 The focus is predominantly on the tech sector， mostly because it is this sector that， though technology， can run more experiments and collect the most amount of data through those experiments to test a hypothesis。 I thoroughly liked the way the book promoted that businesses should use experiments to aide decision making， but not be over reliant on the experiment。 I also appreciate that most experiments are there to drive short term decisions， and how we should design experiments to have longevity， so that we create sustainable businesses。Behavioural economics is a powerful tool， and with great power comes great responsibility。 As with all powerful tools and technologies， we must use this to build better， more inclusive societies， to use these tools too improve humanity， and not for nefarious purposes， or that for increased profit or greed。 I thoroughly enjoyed the book， as it is packed with interesting examples of how experiments were run， and provides insights around how you can create an organisation that experiments。 。。。more
Phil Dearson
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It’s a gentle introduction to the benefits of evidence-based decision-making。 Has a few high profile case studies。 You’re not going to get any depth about decision science or behavioural economics。
Chris Boutté
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Absolutely amazing book。 This book does a great job teaching you how to use experiments in your everyday life as well as at work to test out different methods。 It’s also an Important book to help us learn which studies we should pay attention to or ignore in media
Aidan Gibson
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As dry as an academic book， without the rigor of one。 There is practically nothing in this book that hasn't already been said by Eric Ries and Daniel Kahneman YEARS ago。I have no idea who they were trying to appeal to here， it's too shallow to be an intellectual book and the writing is too poor to be a proper popsci book。 If you have nothing to say， why publish？ As dry as an academic book， without the rigor of one。 There is practically nothing in this book that hasn't already been said by Eric Ries and Daniel Kahneman YEARS ago。I have no idea who they were trying to appeal to here， it's too shallow to be an intellectual book and the writing is too poor to be a proper popsci book。 If you have nothing to say， why publish？ 。。。more
Wen Rei
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One of the chapters that discuss the experimentations carried out by tech companies is eye-opening as companies could not only generate more revenue when they learnt about consumers' behaviour， but also re-evaluate current decisions to save lots of money potentially。 Real-world examples such as Facebook， Google， Airbnb and so on were brought out and it justifies the author's point that companies are experimenting heavily and more companies will follow suit。 One of the chapters that discuss the experimentations carried out by tech companies is eye-opening as companies could not only generate more revenue when they learnt about consumers' behaviour， but also re-evaluate current decisions to save lots of money potentially。 Real-world examples such as Facebook， Google， Airbnb and so on were brought out and it justifies the author's point that companies are experimenting heavily and more companies will follow suit。 。。。more
Todd Cheng
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The book covers key experimentation done in business and industry and how it can impact the goals。 Experimenting is a complement to intuition with data and tests。 Often our gut reaction or what seem intuitive does not result in the best solution。 Testing helps meet key purposes like verifying theory， understanding magnitudes， evaluating policy or products， or exploring fact finding。 it is best to use a series of experimentation to create a better frameworks。 Similar to how a multimodel frame wor The book covers key experimentation done in business and industry and how it can impact the goals。 Experimenting is a complement to intuition with data and tests。 Often our gut reaction or what seem intuitive does not result in the best solution。 Testing helps meet key purposes like verifying theory， understanding magnitudes， evaluating policy or products， or exploring fact finding。 it is best to use a series of experimentation to create a better frameworks。 Similar to how a multimodel frame work provide a better understanding a series of experimentation leads to a better framework。 Test also focus on narrow or short term outcomes。 Often the intuition is wrong and experimentation helps detect the impacts on harder longer term goals。 The book covers how this is being done in many business and government。 It also deletes lightly into the evolving ethics of this in the edge of digital everything with Uber， Facebook， and university。 。。。more
Bookers
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Rating-🌟🌟🌟。5Pages-211How many experiments do you think you’ve participated in over the past year？ We’re talking about randomized controlled trials—experiments designed to test the impact of different treatments by randomly assigning you and other participants （often called subjects） to various treatment conditions， like those you might have participated in if you took Psych 101 or if you’ve tried out an experimental drug。 So， what’s your number？ At first blush， you might think the answer is zero Rating-🌟🌟🌟。5Pages-211How many experiments do you think you’ve participated in over the past year？ We’re talking about randomized controlled trials—experiments designed to test the impact of different treatments by randomly assigning you and other participants （often called subjects） to various treatment conditions， like those you might have participated in if you took Psych 101 or if you’ve tried out an experimental drug。 So， what’s your number？ At first blush， you might think the answer is zero。 But unless you live in a bunker with no Internet access， you’ve likely participated in many experiments over the past year。 If you logged onto Facebook right now， there’s a good chance you’d be an unwitting subject in a variety of the company’s ongoing experiments as you scroll through your News Feed and peruse the ads being shown to you。 You are also likely to be a test subject if you search for an item on Google， watch a movie on Netflix， respond to email surveys， or call companies for customer support。A book backed up with facts and figures and experiments ofcourse。📚Gives the examples of successful and unsuccessful experiments of the of tech giants like #Google #Uber #Facebook and #airbnbBy the end of the book you will be realising that once you start looking， you can’t help noticing incidental experiments everywhere。 Do you see any in your organization？ If so， what insights might you glean from them？ Give this a read。https://amzn。to/3d5lXY0 。。。more
Greg Stoll
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This book was fine enough。 It's all about how companies and governments should do experiments rather than using their intuition about what they think will work。 There's some amount of useful stuff if you're actually in a position to do such things， but other than that the book is mostly examples of places that have done experiments。 A few interesting points:- The British government did an experiment on the wording they used on letters to people that hadn't paid their taxes。 Turns out the most ef This book was fine enough。 It's all about how companies and governments should do experiments rather than using their intuition about what they think will work。 There's some amount of useful stuff if you're actually in a position to do such things， but other than that the book is mostly examples of places that have done experiments。 A few interesting points:- The British government did an experiment on the wording they used on letters to people that hadn't paid their taxes。 Turns out the most effective wording to get people to pay their taxes is to include something like "9 out of 10 people in the UK pay their taxes on time。 You are in the very small minority of people who haven't yet。" The effect is kinda small （the number of people who pay goes up from 35% to 37%）， but of course in aggregate that adds up to a lot of money！- For whether people want to be an organ donor， if it's an opt-in system 4-28% will sign up， but in an opt-out system 86-100%， so the default has a huge effect！ But a lot of people think it's possibly unethical to sign people up by default。 A thought was to move to "active choice"， where the state explicitly asks people whether they want to be organ donors （so there's no default）， but after doing an experiment fewer people signed up than even in the opt-in system！- There's a whole chapter about racial bias on Airbnb， starting with the story of an African-American man trying to book a room but being repeatedly rejected， probably because of his race。 The authors ran an experiment sending a bunch of rental inquiries that were identical except for the name - half were from （fake） guests with first names common among white people （"Brett"， 'Todd"） and half were from fake guests with first names common among black people （"Darnell"， "Jamal"）。 No photos were included for simplicity。 I'm guessing at this point you will not be shocked to read that the names common among black people got 16% fewer yeses from hosts。 （a similar study has been done with resumes for jobs （here's the original PDF）， and the results were similar but the effect was 3 times as large！） Once this study was published， Airbnb was pretty embarrassed and ran some experiments to try to reduce discrimination， but refused to say what experiments they had run or what the results were。 。。。more
Duygu Dagli
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Luca and Bazerman took a subject which has great potential and wasted it with presenting the reader excerpts from Thaler's Nudge and Duckworth's Grit， and talking about some of the research centers the writers worked for。 The rest of the book is a few examples from tech industry。 The message this book is trying to deliver is "You can use tests/experiments to answer your questions" which unfortunately for a book written in 2020 is at least 15 years too late。 I admit that I am not an average reade Luca and Bazerman took a subject which has great potential and wasted it with presenting the reader excerpts from Thaler's Nudge and Duckworth's Grit， and talking about some of the research centers the writers worked for。 The rest of the book is a few examples from tech industry。 The message this book is trying to deliver is "You can use tests/experiments to answer your questions" which unfortunately for a book written in 2020 is at least 15 years too late。 I admit that I am not an average reader。 I spent two years in graduate school， studying behavorial economics and experiments。 I design and run experiments in non-tech organizations as a part of my job。 I know the content of this book by hearth。 What the authors don't realize is， every single organization I've worked for or interviewed with since 2008， every single one of them knew that they could use an experiment to answer a question。 What they didn't know or still don't know is， self selection bias， the concept of statistical significance， controlling for confounder effects or controlling for interactions。 Most of these companies （including tech） run multiple tests on the same subject at the same time and assume independent results， just show why it isn't。This book gave me absolutely nothing and it will not give anything new to a reader who at least knows what an A/B Test is。 I have wasted $16 and 2ish hours on this。 Learn from my mistake and don't waste yours。 。。。more
Nitin
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The book is a great introduction to experiments and experimental thinking。 The examples given in the book are really eye-opening and the discussions on them are also insighful。 I didn't care for the structure of the book but the content was really amazing。 The book is a great introduction to experiments and experimental thinking。 The examples given in the book are really eye-opening and the discussions on them are also insighful。 I didn't care for the structure of the book but the content was really amazing。 。。。more
Andreas Aristidou
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This is a thoughtful， short and concise book about an in-demand topic， written by leading academics in the field of behavioral economics and experimentation。 Luca and Bazerman provide examples to illustrate their points from various angles without making the book simply a collection of bullet points。 They dive into the historical roots of behavioral science and experiments， focusing on the fields of Psychology and Economics。 The authors cleverly describe the technicalities of experiments and beh This is a thoughtful， short and concise book about an in-demand topic， written by leading academics in the field of behavioral economics and experimentation。 Luca and Bazerman provide examples to illustrate their points from various angles without making the book simply a collection of bullet points。 They dive into the historical roots of behavioral science and experiments， focusing on the fields of Psychology and Economics。 The authors cleverly describe the technicalities of experiments and behavioral insights with easy distinctions between similar and often confusing concepts， precluding the need for more technical detail。 I particularly enjoyed the structured and organized dive into tech industry experiments。 Each chapter of Part II describes one such experiment / tech company， accompanied by a lesson that illustrates the “take-away” point。 Occasionally， I found their background stories to be somewhat myopically focused on researchers and organizations affiliated with their institution – Harvard University。 As someone who is very familiar with the literatures they touch upon， I would expect to see a slightly broader perspective of how the contributions of other institutions helped shape the state of behavioral experimentation。 Overall however， I would highly recommend this book to anyone – not necessarily to people interested in experiments。 It’s such an important， widespread and on the rise topic， presented in a very accessible and illustrative manner， that it’s probably worth anyone’s time。 Read a detailed chapter-by-chapter summary on my blog here: https://aristidouandreas。com/book-rev。。。 。。。more
Theodore Kinni
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