• Government's Bogus Study on Chinatown Busses

      The nation's fastest growing mass transit - intercity busses - was pioneered by Chinese immigrant entrepreneurs, who figured out that by doing without a station and picking people up from the street, they could save money and offer cheap fares. Their services became known as "Chinatown busses."

      Then the government cracked down on those entrepreneurs. Regulators forced 27 bus companies based in Chinatown to close, according to Jim Epstein of Reason.

      The reason cited was safety. Last year headlines blared: "Chinatown Buses Death Rate Said Seven Times That of Others." That was according to a study by the National Transportation Safety Board.

      But Epstein reports that:

      The government got the data wrong. They mistakenly included bus operators like Greyhound along with Chinatown busses.

      The government then calculated the average crash rate incorrectly. Had they done the math right, they would have found almost no difference between Chinatown and conventional busses.

      Epstein consulted a statistics professor and hedge fund statistician about the study:

      "When I first read the NTSB report, I thought this is just terrible statistics," says [Aaron Brown, a quantitative analyst with the hedge fund AQR Capital Management]. "But it goes way beyond that. It's almost as if someone took some random data and shook it together."

      The government's response to those problems? "The NTSB stands by its report."

      Keep this in mind next time people say we should trust those "experts" in government.

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      Entrepreneurs
      chinatown bus