According to bestplaces.net, Seattle, Washington averages 38 inches of rain per year, while Nashville gets 49.3 inches of rain per year on average. Thus, on… Read More »Is Nashville Rainier Than Seattle? The Problem with Averages

In developing Modern Portfolio Theory, economist Harry Markowitz posited a relationship between risk and reward that exhibited a positive correlation between risk and return, like… Read More »The Myth of the Efficient Frontier in Investing

When risk analysis is used as the basis for funding a project, the level of funding is typically at or below the 80th percentile, depending… Read More »Why Aren’t Projects Funded to High Percentiles?

I was recently asked by a client why cost uncertainty is lognormal. While the normal distribution is familiar to every statistics student, the lognormal is… Read More »Why Cost Uncertainty Is Lognormal

The James Webb Space Telescope (JWST), launched on Christmas Day last year, has started producing some spectacular images: However, the successor to Hubble spent 25… Read More »James Webb Space Telescope – But What About the Cost (And Schedule)?

I recently saw yet another article about quantitative risk analysis that made me cringe because of its mistaken claims. It was, in the words of… Read More »Five Myths About Quantitative Risk Analysis

As of June 14, more than 600,000 people have died from COVID-19. However, the total impact is not reflected in just the COVID-19 deaths. In… Read More »Big Risk Vs. Small Risks, Or What Economists Still Don’t Get About Extreme Hazards

The Iron Bowl is the annual (American) football game between the University of Alabama and Auburn University. When I was in college, one of my… Read More »The Neoclassical Supply Curve, the Iron Bowl, and Reality

In my last post, I noted the apparent contradiction between supply curves and learning curves. Both display a relationship between cost/price and quantity, but one… Read More »Learning Curves and Rate Curves – Which One Represents Supply?

I recently taught a training class on learning curve theory, which is a basic cost estimating concept for production. Engineers working on aircraft manufacturing in… Read More »Do Learning Curves Offer Potential New Insights into Economic Theory?