The Poverty of Macro-Analysis
Statistics attempts to simplify our understanding of the complex world in which we live, and in many areas, it has certainly lived up to this task. Statistics gives us the tools to understand broad macro-trends occurring within a population, to understand the evolution of points in a data set, and to extrapolate into the future. In the real world, we can leverage statistics to understand how trends emerge, how businesses might grow, and how our economies might evolve in future.
Yet there are very real limits to statistical analysis which when overlooked, result in a gross misunderstanding of reality. One such mistake is to assume that what applies to the macro applies to the micro. Group charactaristics do not permit one to understand the specificities of an individual, they merely allow us to determine the statistical likelihood of that individual’s placement relative to other entities. Looking at the group can therefore be useful, but it says very little about the specific interactions between individuals. A understanding of the micro is thus essential.
We saw this in the hard sciences: whereas we previously attempted to understand objects on a macro-scale, the arrival of the microscope in 1590 enabled us to go one step deeper, eventually paving the way for our understanding of protons, neutrons and electrons, and now the even smaller sub-particles which compose them. This in turn has only led to an even more substantial understanding of physics and biology.
In the social sciences however, we have seen a trend in the opposite direction. Though some of the earliest sociologists began trying to understand individuals on a micro-level and the literature is replete with excellent analysis from thinkers like Erving Goffman, there has been a broader paradigm shift towards looking at things on the macro-level, often without first developing an understanding of the micro. A failure to understand the micro only leads to over-generalisations, based on the assumption that all humans act the same.
For example, many will make inferences from macro-statistics on the gender pay gap, on educational attainment, and on average lifetime incomes without first having dissected the micro-interactions occurring between individuals. This is then combined with another macro approach, which looks at everybody through group charactaristics rather than as individuals, often through the lens of class, race, or gender struggle. In reality, there is a plethora of other factors to consider that might contribute to the phenomena listed above.
This oversimplicity leads to us diagnose problems where none exist, and to us attempting to fix very real problems through a broad stroke approach that has very little impact on tackling the underlying cause. Looking at groups can be useful, but we cannot ignore the primacy of the individuals who forms the group.
Yet this mistake continues to be made on an almost daily basis. When we speak of institutional inequalities and disparities, the language that is used often implies that the institution has a life of its own, independent of the individuals who make up the organisation. This is of course untrue: an organisation is merely a legal agreement, a figment of the imagination. Thus the only way to tackle illigitimate ‘instutitional’ inequalities is by tackling them on a micro-level — looking at individuals rather than groups.
Another area of the social sciences where there is a tendency to over generalise and look at things solely through a macro lens is in the so-called ‘intersectional approach,’ which attempts to understand phenomena through looking at an intersection of salient group characteristics and how they might intersect in a given scenario. Whilst this is certainly better than looking only at one charactaristic, there is a tendency to look at people solely through the statistical averages of the groups to which they pertain and to ignore the individual. To fully understand social interactions, we must also examine the individual beliefs, culture and upbringing of a person and how they might interact on a micro-level with others holding different beliefs and from different backgrounds. A person is far more than the groups they belong to: they will have unique thoughts, experiences, and perspectives irrespective of their group charactaristics. We must therefore try to understand what drives individuals and the incentives they face, rather than looking solely at broad macro trends.
This is something that very few prominent commentators, activists, and sociologists have attempted to do. This no-doubt makes it far easier to blame all of societies’ woes on the ‘bourgeoisie’ that Marxists love to lambast and on the ‘patriarchy’ that some feminists will insist is the only thing holding women down. Yet a pure macro analysis without understanding the micro provides an over-simplistic view on everything and very few real solutions.
The way forward is clear. If we are to make real advancements in the social sciences, we must move past the current paradigm of looking at everything through a purely macro lens and attempt to better understand the micro-interactions occurring between individuals. A core part of this will mean drawing on our knowledge from the fields of psychology, economics, and evolutionary biology, all of which give us a richer understanding of what drives individuals and how they choose to interact. A better understanding of statistics is also essential: we must understand what we are actually looking at and the limitations of this data and of statistical analysis more widely. It will not suffice to frame everything in terms of class, racial, or gendered conflict, as many on the political left are inclined to do. A better understanding of micro interactions and human action is essential to see the world more clearly.