3 ms·
It's pretty obvious, really. A quick little sketchproof; say you have a metric, like headcount, revenue, expenses - whatever. These tend to grow exponentially-i
by automatic6131 4y ago
It's pretty obvious, really. A quick little sketchproof; say you have a metric, like headcount, revenue, expenses - whatever. These tend to grow exponentially-ish over time. When that's the regime, the number spends 1/3rd of it's time between 1 and 2 of its leading digit, and 2/3rds growing from 2 to the next power of 10. Similar logic applies if you're counting things that follow any power law - population of cities etc. Wherever you have a power law distribution, Benford's law applies.
But when humans enter data, they tend to fake numbers with a uniform distribution - to appear more random. That's how you catch it.