On Bill Simmons' BS Report podcast, Daryl Morey, the General Manager of the Houston Rockets, discussed his team releasing Jeremy Lin before Lin joined the New York Knicks and became 2012's breakout basketball star.
Morey, in this clip, describes the difference between what he calls "Type I" error - his error of commission - and "Type II" error. Morey is guilty of a Type I error - he waived Lin when he should have kept the guard on the roster. Besides the Knicks and the Golden State Warriors (the team that drafted him), the other teams committed a "Type II" error - they never gave Lin a chance in the first place, despite each having had the opportunity to do so.
This is important. The Rockets and Morey got criticism for letting Lin get away. The other teams largely escaped criticism because they didn't even give him a chance. Who's the better decisionmaker here? Morey or his passive rivals?
Listen to the audio clip here: Daryl Morey of the Houston Rockets on Type 1 Error (1:38) [There is an embedded audio player you can access at the bottom of the page.]
Here's a precise statistical definition of Type I and Type II error. What Morey describes isn't exactly this, but I get his point.
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