Chapter 14: Base Rate
Chapter 14 - Base Rate
Base rate is the mean number of times an event occurs divided by the mean number of times it might occur. Representativeness is a bias when people wholly and exclusively rely on pre-conceived notions. Empirical evidence suggests that people formulate their judgments by relying on representativeness and neglect the base rate. This results in sub-optimal judgments and guesses. Given a plausible base rate, the anchoring of judgment of the probability of an outcome whilst putting under question the diagnostic validity of the evidence is known as Bayesian reasoning.
Key Findings
Empirical evidence reveals that sub-optimal judgments and guesses are often made.
Bayesian reasoning is considered to be relatively reasonable.
Base rate is the mean number of times an event occurs divided by the mean number of times it might occur. Representativeness is a bias when people wholly and exclusively rely on pre-conceived notions. Empirical evidence suggests that people formulate their judgments by relying on representativeness and neglect the base rate. This results in sub-optimal judgments and guesses. Given a plausible base rate, the anchoring of judgment of the probability of an outcome whilst putting under question the diagnostic validity of the evidence is known as Bayesian reasoning.
Key Findings
Empirical evidence reveals that sub-optimal judgments and guesses are often made.
Bayesian reasoning is considered to be relatively reasonable.