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The fine line between fraud and a null result

By Nicholas Gruen - posted Tuesday, 4 December 2012

Aside from war, corruption is probably the biggest obstacle to economic and social development in poor countries. But it's best we see ourselves as being on a continuum with them, rather than as having solved the problem. Even if no law was broken, Wall Street financiers imposed vast costs on us all by corrupting the financial system - while they walked away with billions.

The way I see it, all social and economic institutions are an ecology of private and public goods - of private and public motives. If I'm right, our penchant for ideological trench warfare between those arguing for the primacy of the private over the public or vice versa is a sideshow. What matters is making the ecology of public and private as healthy as possible.

Let me explain.


In a market, people pursue their own interests. That's the point of markets. But that self-seeking is according to rules. In addition to pervasive social norms, there's also the law. But whereas traders are self-interested (mostly within the rules) those enforcing the rules - such as police and judges - represent collective interests and must reflect that in their work, rather than their self-interest. Market failure arises where such public standards cannot be delivered - so traders must waste their time and resources checking to ensure they're not being cheated and fighting for their share.

And this same ecology of public and private goods, of competitive and public spirited endeavour, is just as crucial in the market for knowledge.

Shi-min Fang was shocked to discover the extent of misconduct on returning to his native China from US scientific training. Since 2000, his website New Threads has relentlessly exposed plagiarism, fraud and corruption in Chinese science. It's making a difference. He's just won the international Maddox Prize for his efforts. But don't get too smug about developed country science. Though outright fraud is very rare, you'd be amazed at how corrupted things are.

In the mid 2000s, Massachusetts builder and self-taught 29-year-old architect Stephen Heywood was diagnosed with the horrible Lou Gehrig's disease, or ALS, which produces rapid and ultimately fatal neuronal degeneration. His brothers Jamie and Benjamin completely rearranged their lives to try to save him. They identified 15 promising results in the literature that might have helped him. Incredibly, as they replicated each study, not one positive result was confirmed.

I doubt any of the studies were deliberate frauds. Something much subtler is going on. A Nature article recently identified numerous interrelated culprits. First, though we might think of scientists and academics as a dispassionate lot, their imagination is captivated far more by a positive relationship - say between some substance and cancer, or a cancer cure - than a ''null result''.

And with journals the world over, like the popular press, far keener to publish positive findings than null results, the incentives for scientists are clear. Let's say you're a researcher looking for some positive association to impress your colleagues and score that prestigious publication, but your experiment didn't produce such an association. You can always run it again - and if necessary again and again, each time with variations. As the great, now centenarian economist Ronald Coase says, "If you torture the data long enough, it will confess".


There are plenty of institutions that should represent the public interest in the integrity of this market for knowledge. Jealous of their reputation, journals use peer review to vouchsafe the integrity of what they publish. But they're already rife with publication bias. And peer review doesn't come with the resources necessary to replicate experiments.

The universities and foundations where so much of this work is done are publicly or philanthropically funded. So you'd think they'd be motivated by the public interest. But only to a point. Competition between them is intensifying under the influence of government policy, with funding and official rankings between institutions based on - you guessed it - publications!

Of course, the vast body of scientific literature isn't vitiated by these problems. But as the Heywoods' experience illustrates, it's corrupted to a surprising extent. That's because many institutions we think of as reflecting the public interest routinely forsake it to pursue their own interests.

Meanwhile, public-spirited individuals are doing what they can. The Cochrane Collaboration, a scientific network of more than 28,000 volunteers in more than 100 countries, promotes vigilance. Shi-min Fang tends his website and the Heywood brothers founded the world's first non-profit biotech firm which develops ALS treatments outside strictures of academic and corporate life. They also founded the website PatientsLikeMe that helps users manage their illness with tools such as diaries and social networking, while assembling a database that helps patients and scientists distinguish between what helps treat their disease, and what generates a null result.

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This article was first published in The Age on November 28, 2012.

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About the Author

Dr Nicholas Gruen is CEO of Lateral Economics and Chairman of Peach Refund Mortgage Broker. He is working on a book entitled Reimagining Economic Reform.

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