Base Rate Neglect
Ignoring how common something is in general when a vivid specific detail is available; the case story beats the statistics every time, and the statistics are usually right.
An everyday example
Hiring on a great interview against a 30% success rate for that profile; believing a positive test without asking how rare the condition is.
What it can cost you
Judgments driven by the particular; sellers who supply the particular and omit the rate.
Warning signs
- The story is doing the estimating.
- I have not asked how often this happens.
One thing to do
Start every estimate from the base rate and adjust only for evidenced specifics. Merged: base-rate fallacy inversion.
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