1. Back in March, after the results of the Urban Local Body polls came out, I had predicted a victory for the Congress in the assembly elections.

2. Then, a couple of weeks back, I used the logic that people like to vote for the winner, and this winner-chasing will result in a self-fulfilling prophecy that will lead to a comfortable Congress victory.

These two predictions were on the “Resident Quant” blog that I run for the Takshashila Institution. It was a classic prediction strategy – put out your predictions in a slightly obscure place, so that you can quickly bury it in case it doesn’t turn out to be right, but showcase it in case you are indeed correct! After that, however, things went slightly wrong (or right?). Looking at my election coverage Mint asked me to start writing for them.

As it happened I didn’t venture to make further predictions till the elections, apart from building a DIY model where people could input swings in favour of or against parties, and get a seat projection. Watching the exit polls on Sunday, however, compelled me to plug in the exit poll numbers into my DIY model, and come up with my own prediction. I quickly wrote up a short piece.

3. As it happened, Mint decided to publish my predictions on its front page, and now I had nowhere to hide. I had taken a more extreme position compared to most other pollsters. While they had taken care to include some numbers that didn’t mean an absolute majority in the range the predicted for the Congress (so as to shield themselves in that eventuality), I found my model compelling enough to predict an outright victory for the Congress. “A comfortable majority of at least 125 seats”, I wrote.

I had a fairly stressful day today, as the counting took place. Initial times were good, as the early leads went according to my predictions. Even when the BJP had more leads than the Congress, I knew those were in seats that I had anyway tipped them to win, so I felt smug. Things started going bad, however, when the wins of the independents started coming out. The model I had used was unable to take care of them, so I had completely left them out of my analysis. And now I was staring at the possibility that the Congress may not even hit the magic figure of 113 (for an absolute majority), let alone reach my prediction of 125. I prepared myself to eat the humble pie.

Things started turning then, however. It turned out that counting had begun late in the hyderabad karnataka seats – a region that the Congress virtually swept. As I left my seat to get myself some lunch, the Congress number tipped past 113. And soon it was at 119. And then five minutes again back at 113. And so it continued to see-saw for a while, as I sat at the edge of my office chair which I had transplanted to in front of my television.

And then it ticked up again, and stayed at 119 for a while. And soon it was ticking past 120. All results have now been declared, with the Congress clocking up 121 seats. It falls short of the majority I had predicted, but it is a comfortable majority nevertheless. I know I got the BJP number horribly wrong, but so did most other pollsters, for nobody expected them to get only 20% of the popular vote. I also admit to have missed the surge in Independents and “Others”.

Nevertheless, I think I’ve consistently got the results of the elections broadly right, and so I can stake claim to some bragging rights. Do you think I’m being unreasonable?

Yet another positive of ADHD, I realized yesterday, is that it allows you to lead a “markovian” life. It allows you to easily get rid of historical baggage while taking decisions, and makes you look forward by taking a decision based on the present. Yes, it can sometimes be a bit troublesome, as it prevents you from following long-drawn-out plans, but mostly it’s a good thing.

It makes you disregard that you’d taken a decision for some reason in the past. It makes it easy for you to disconnect from your earlier decisions, and look forward. It doesn’t allow you to be swayed by emotions – on account of some decision you’d taken in the past, and instead makes you rely on rational reasons.

There’s this documentary called “ADD and loving it”. Maybe I should watch that. And maybe I’ll have something to add to that.

I decided to go back another decade, to the 1983 elections, and for all elections from 1983 to 2004 I’ve mapped out how each of the 3 principal parties in Karnataka performed. I’ve grouped all the Janata Parivar parties (Janata Party, Janata Dal, and their offshoots) and coloured them green. The Congress has been coloured blue while the BJP is saffron. Seats won by independents/others have been coloured in black.

Source: http://www.partyanalyst.com/

Notice:

1. Before the Janata Dal split in 1999, the JD had a significant presence even in Bombay Karnataka, where it is now supposed to have absolutely no presence.
2. The growth of the BJP has been outward from the Mangalore-Udupi area. One needs to remember that the Dakshina Kannada and Udupi districts are extremely diverse in terms of religion, so perhaps the Hindutva card works better there than elsewhere? Also, the coastal districts are where the RSS first set up its roots in Karnataka.
3. In 1999 and 2004, the BJP actually won some seats in the old Mysore region outside of Bangalore. In 2008, though, the BJP was decimated in this region. It is unlikely it will regain some base in this area in the coming election
4. The Congress won a whopping 178 seats in 1989. And what happened? Intense jockeying for the post of CM. Three CMs over the course of five years (Veerendra Patil, S Bangarappa and Veerappa Moily) followed by a humiliating loss in 1994 when the Congress came third!
5. The JD split in 1999 hit it badly. In most constituencies both the JD (U) and the JD(S) contested. That probably played into the hands of the Congress which won a simple majority. By 2004, the JD (U) was virtually non-existent in Karnataka, and the JD (S) managed to consolidate all the Janata votes and did well.
6. Even in 2004, you might notice that the BJP was virtually confined to the western half of Karnataka. In 2008, thanks to the efforts of the Reddy brothers, in addition to Western Karnataka they swept the regions in and around Bellary, which pushed them past the target. With the Reddys in jail and their right-hand-man B Sriramulu having formed his own party, the BJP won’t come close to a majority this time.

Unfortunately I haven’t been able to get my hands on the shapefiles of the delimited constituencies (2008 and later), so I’m unable to include the 2008 results in this chart. If any of you can supply me the shapefiles, or at least the constituency map of the new assembly constituencies, I’d be most grateful.

I last ran my model on April 1st, and this is my prediction of the final tally of the Premier League.

My prediction of what the EPL table will be like at the end of the season. As of 1st April 2013

Some notes

1. This is a purely statistical model based on goals scored so far in the season. For each time I’ve modeled how many goals they’ll score given the number of points their opponents have racked up in the league so far

2. I know this is wildly optimistic for Manchester United as the model thinks they will win each of their next 8 games. I don’t think this is going to happen. So disregard that prediction

3. Interestingly the top of the table according to my prediction is identical to the top of the table now.

While the BJP ended up as the single largest party with 110 seats (with the Congress second with 79), the Congress actually had a larger share of the popular vote compared to the BJP (34% versus 33% respectively). However, it can be said that the BJP “picked its battles” concentrating on its strongholds in North Karnataka, Bangalore and the coastal areas, and thus managed to surge ahead of the Congress in terms of seats.

However, analysis shows that even this surge in terms of seats was rather shaky. It was a result of coming together of a number of forces – a united BJP under Yeddyurappa’s leadership, the support of the Lingayat Mutts and Reddy brothers, and good candidate selection. Today, we will analyze how the 2008 Elections would have gone if Yeddyurappa’s KJP and B Sriramulu’s BSR congress had split from the BJP ahead of those elections.

The KJP and BSR Congress played key roles in the recent urban local body elections. Based on the local body elections, we project in each parliamentary constituency how much of what might have been the undivided BJP’s votes have gone to these breakaways. We assume that all the vote that the KJP or BSR congress got came from what the united BJP would have otherwise got. Next, we look at the 2008 Assembly election numbers and for each constituency, allocate the BJP’s votes among the BJP, KJP and BSR Congress proportional to their performance in the urban local body elections in that area.

The results, given below are rather surprising. While the KJP itself would have won not more than a handful of seats and the BSR Congress would have won nothing, our analysis shows that the BJP’s seats would have almost come down by half, with the Congress getting the lion’s share of what the BJP lost!

Red bars show actual performance in 2008. Blue bars show what the seat distribution might have been had the BJP been without the KJP and BSR Congress

It would be interesting to see where the BJP lost the seats. The following graph shows, by Parliamentary constituency the number of Assembly constituencies that the BJP lost thanks to the parting with the KJP and BSR Congress.

This graph shows the number of seats the BJP would have lost in each parliamentary constituency had it been separate from the KJP in 2008

So what are the implications? The big insight is that it is indeed bad tidings for the BJP. Even if the party were to have the same public sympathy that it did in 2008 (highly unlikely, given its government’s performance), it is going to struggle to get anywhere close to a majority. Currently the Congress is in as much of a mess as it was in in 2008, with rampant infighting and a battle between Parameshwar and Siddaramaiah for control of ticket distribution. Our analysis shows that even if the Congress does as well as it did in 2008 (remember that our ULB-based analysis showed it would do better), it stands to gain an absolute majority. There is no surprise why there is so much clamour for tickets within the Congress.

Now, my point is that if you want to raise venture funding, you better do it when you think you are on the cusp of one such inflexion. Usually points of inflexion are associated with some increase in “leading” investment, and a small chance that the company will get on to a new trajectory, and a big chance that the company will go under.

This crude chart shows the typical trajectory of a young company. The beginning of the red zone is when you should raise venture money

If you look at the picture here, the beginning of the red region is the state where you need to get venture funding. The thing with the black regions is that irrespective of how you fund those, at best you can expect steady growth. Now, venture capital funds, the way they are structured, are not set out to fund steady growth. The way venture funds make money is when one out of a number of their investments makes shockingly great returns, while the rest go under. They are not in the business of funding steady returns.

Hence, when they fund your company they value you assuming that in case your company is successful there will be steep growth, which will enable them to recover their investment. And if your company is in steady growth phase, it is never going to be able to do that. And you will have a case of your investors pushing you to do more or something different from what you had planned doing. The problem here lies in the fact that you raised the wrong kind of funding!

In times like this or at the turn of the millennium, when venture capital is big, it can sometimes become the preferred mode of fundraising for a lot of companies. The problem, however, is that most of them don’t realize that venture funding is probably not the best form of funding for them at their size and scale, and then get weighed down by investors.

On a similar note, you should go public once you know that there are no really big points of inflexion coming up, and that your company is set on a path to steady growth. Again that follows from the fact that investors in the stock market (where they pick up tiny shares in each company) are usually in it for long-term steady growth. And if you happen to take undue risks and they don’t pay off, your stock will get hammered unnecessarily.

Regional leaders are entitled to, and should, have their opinions when it comes to foreign policy. However, these opinions should be discussed in Parliament or Cabinet or some similar forum, and as far as the outside world is concerned, India should have a single foreign policy. It might be in the Tamil Nadu politicians’ own political interests to take a hard stand on this Sri Lanka issue, but it is the job of the Union Government (and the Prime Minister) to hear these voices, debate them and make a decision which the regional leaders are bound to obey.

It is well known that Tamil Nadu politicians don’t want the Sri Lankans to participate in the IPL, and this might be a corollary of their stand that the Indian government should not engage with the current political establishment in Sri Lanka. Taking that into consideration, the Union Government should do one of two things – accept the stand of the TN politicians and deny work permits to the Sri Lankan cricketers, or allow the Sri Lankans to participate in the entire tournament, including in Chennai.

It is important that India presents a coherent face when it comes to foreign policy. We have already seen one international deal (on the Farakka barrage, with Bangladesh) being scuttled at the last minute because of last-minute reservations expressed by regional politicians. If we present a divided stance on this IPL issue, it could send out a signal that Indian foreign policy is hostage to regional leaders, and that it is difficult to do business with India (since that entails doing deals with regional leaders also).

At a time when doing business with other countries is paramount (given our energy security concerns) , it is important that we send a signal that we are easy to do business with. And for that, we need to signal that we have one foreign policy.

Tailpiece: I wonder whether under their current stance the TN politicians will allow Muthiah Muralitharan, a Tamil Sri Lankan who is married to a Madrasi, to play in Chennai.

So about a month back I decided I need to add to my education in Carnatic and Western Classical Music and decided to learn Hindustani Classical. I decided it was time to learn a new instrument (so far I’d been trained only in playing the violin) and after some facebook queries, found a teacher who lived close by. After a lecture in how he teaches to take forward a “parampara” and not for money, and that he expects extreme devotion from students, and that he likes to begin classes for a new student only on a Monday, classes began in right earnest.

Classes soon hit a roadblock, though. As the more perceptive of you here might be aware, I have (I don’t want to use the word “suffer”) ADHD (Attention Deficit and Hyperactivity Disorder), thanks to which my attention span is grossly lower than that of the normal human being. Weeks together of simply going up and down the (Bilawal) scale soon got to me and I lost interest in practicing. Soon I realized I had started to look for excuses to bunk classes. I decided to cut my losses and decided to discontinue class.

Before I discontinued class, however, I  thought long and hard about telling my teacher about my ADHD, and that his methods of teaching weren’t working out for me. I wanted to tell him about the Suzuki method which my Western Classical teacher had adopted a year ago, which kept me interested in the music without relaxation of rigour. The Suzuki Method had worked fantastically well for me. Each class I would learn a new (simple) song – for example, I started my Western Classical learning by learning to play Twinkle Twinkle Little Star.

There are times when I think that I should have given my sitar teacher a fairer chance and explained to him about the Suzuki method and adopt something like it for the Sitar. However, from my knowledge of him based on my intereaction with him for a month or so, it didn’t seem like it would work, and I ended up (regretfully) quitting without giving him a chance to push the education on me.

The thing with traditional Indian learning is that it is fundamentally “pull”. The onus is on the student to convince the teacher to take him on as a student, and then to extract knowledge and wisdom from the teacher. In the traditional Indian context, it is absolutely okay for the guru to be aloof and disinterested, for it is not his duty to teach – it is the student’s duty to extract knowledge from the teacher. In fact my friend and colleague Nitin Pai informs me that according to the Upanishads, it is the duty of the teacher to reject a student the first three times he “applies”, and accept a student only after he has sucked up considerably.

While there might have been good reasons for such teaching practices back in the Vedic and Puranic ages (for example, the caste system forbid considerable sections of the population from learning the scriptures), these practices are wholly unsuited for the modern age where the focus is on increasing the reach of education and and ensuring that more people have access to education.

With the onus being on universal education and on getting every child to learn, we need to get rid of the “Acharya Devo Bhava” (teacher is god) paradigm and instead shift to a framework  of professional teachers where it is the teacher’s duty to reach out to the student. We need to get to a paradigm where the students can demand that the teacher reach out to them and teach them, and where students don’t need to suck up to the teacher.

The “acharya devo bhava” concept might have served us well in the pre-writing age and ensured that our most important scriptures were transmitted down to an era where they could be written down. This paradigm, however, is not scalable, and definitely not suited to a situation where the objective is to provide education to everybody.

Flawed though it may be, the Right to Education Act is a good step by the Union Government to ensure greater learning among kids and to maximize our chances of making good of the demographic dividend. The measure, however, will be dead on arrival unless the mindset of teaching and learning is changed.

Last month I was showing my mother-in-law the video of the meteor that fell in Russia causing much havoc, and soon the conversation drifted to why the meteor fell where it did. “It is simple mathematics that the meteor fell in Russia”, I declared, trying to show off my knowledge of geography and probability, arguing that Russia’s large landmass made it the most probable country for the meteor to fall in. My mother-in-law, however, wasn’t convinced. “It’s all god’s choice”, she said.

Recently I realized the fallacy in my argument. While it was probabilistically most likely that the meteor would fall in Russia than in any other country, there was no good scientific reason to explain why it fell at the exact place it did. It could have just as likely fallen in any other place. It was just a matter of chance that it fell where it did.

Falling meteors are not the only events in life that happen with a certain degree of randomness. There are way too many things that are beyond our control which happen when they happen and the way they happen for no good reason. And the kicker is that it all just doesn’t average out. Think about the meteor itself for example. A meteor falling is such a rare event that it is unlikely to happen (at least with this kind of impact) again in most people’s lifetimes. This can be quite confounding for most people.

Every time I’ve studied probability (be it in school or engineering college or business school), I’ve noticed that most people have much trouble understanding it. I might be generalizing based on my cohort but I don’t think it would be too much of a stretch to say that probability is not the easiest of subjects to grasp for most people. Which is a real tragedy given the amount of randomness that is a fixture in everyone’s lives.

Because of the randomness inherent in everyone’s lives, and because most of these random events don’t really average out in people’s lifetimes, people find the need to call upon an external entity to explain these events. And once the existence of one such entity is established, it is only natural to attribute every random event to the actions of this entity.

And then there is the oldest mistake in statistics – assuming that if two events happen simultaneously or one after another, one of the events is the cause for the other. (I’m writing this post while watching football) Back in 2008-09, the last time Liverpool FC presented a good challenge for the English Premier League, I noticed a pattern over a month where Liverpool won all the games that I happened to watch live (on TV) and either drew or lost the others. Being rather superstitious, I immediately came to the conclusion that my watching a game actually led to a Liverpool victory. And every time that didn’t happen (that 2-2 draw at Hull comes to mind) I would try to rationalize that by attributing it to a factor I had hitherto left out of “my model” (like I was seated on the wrong chair or that my phone was ringing when a goal went in or something).

So you have a number of events which happen the way they happen randomly, and for no particular reason. Then, you have pairs of events that for random reasons happen in conjunction with one another, and the human mind that doesn’t like un-explainable events quickly draws a conclusion that one led to the other. And then when the pattern breaks, the model gets extended in random directions.

Randomness leads you to believe in an external entity who is possibly choreographing the world. When enough of you believe in one such entity, you come up with a name for the entity, for example “God”. Then people come up with their own ways of appeasing this “God”, in the hope that it will lead to “God” choreographing events in their favour. Certain ways of appeasement happen simultaneously with events favourable to the people who appeased. These ways of appeasement are then recognized as legitimate methods to appease “God”. And everyone starts following them.

Of course, the experiment is not repeatable – for the results were purely random. So people carry out activities to appease “God” and yet experience events that are unfavourable to them. This is where model extension kicks in. Over time, certain ways of model extension have proved to be more convincing than others, the most common one (at least in India) being ‘”God” is doing this to me because he/she wants to test me”. Sometimes these model extensions also fail to convince. However, the person has so much faith in the model (it has after all been handed over to him/her by his/her ancestors, and a wrong model could definitely not have propagated?) that he/she is not willing to question the model, and tries instead to further extend it in another random direction.

In different parts of the world, different methods of appeasement to “God” happened in conjunction with events favourable to the appeasers, and so this led to different religions. Some people whose appeasements were correlated with favourable events had greater political power (or negotiation skills) than others, so the methods of appeasement favoured by the former grew dominant in that particular society. Over time, mostly due to political and military superiority, some of these methods of appeasement grew disproportionately, and others lost their way. And we had what are now known as “major religions”. I don’t need to continue this story.

So going back, it all once again boils down to the median man’s poor understanding of concepts of probability and randomness, and the desire to explain all possible events. Had human understanding of probability and randomness been superior, it is possible that religion didn’t exist at all!

As soon as I reached the counter the first thing the clerk asked me was if i had complied with the know your customer norms. I guess this must be a fallout of the recent sting operation against some banks with respect to money laundering. As it happened the account to which I was transferring money was not compliant. It didn’t even have my address or date of birth. I was summarily told I wouldn’t be able to operate it unless I provide the necessary operations.

I classify banks as human and computer. Private and foreign banks are what I call computer banks. They have excellent online banking, phone banking  and are great at executing routine tasks. However ask them to do something non standard or something that required human intelligence and they falter badly. The processes are so strict the front line staff are not empowered at all.

PSU banks on the other hand are human banks. Online banking sucks as does phone banking. You don’t get door delivery of demand drafts. However these banks are great at empowering their front line staff thanks to which you can expect to get superior service.

A minute after the clerk told me that I wouldn’t be able to operate my public provident fund account because it didn’t comply with the norms she noticed that the cheque I’d written out was from the same bank. Let me see if this account is compliant, she said.  It turned out that my savings account was fully compliant.
It was only a matter of minutes after that. She quickly copied out the necessary information from my savings account to my provident fund account and then called the bank manager to immediately approve the compliance. In another five minutes the money had been duly transferred and my work was done.