The base rate fallacy reconsidered: Descriptive, normative, and methodological challenges

Jonathan J. Koehler*

*Corresponding author for this work

    Research output: Contribution to journalReview articlepeer-review

    384 Scopus citations

    Abstract

    We have been oversold on the base rate fallacy in probabilistic judgment from an empirical, normative, and methodological standpoint. At the empirical level, a thorough examination of the base rate literature (including the famous lawyer-engineer problem) does not support the conventional wisdom that people routinely ignore base rates. Quite the contrary, the literature shows that base rates are almost always used and that their degree of use depends on task structure and representation. Specifically, base rates play a relatively larger role in the tasks where base rates are implicitly learned or can be represented in frequentist terms. Base rates are also used more when they are reliable and relatively more diagnostic than available individuating information. At the normative level, the base rate fallacy should be rejected because few tasks map unambiguously into the narrow framework that is held up as the standard of good decision making. Mechanical applications of Bayes's theorem to identify performance errors are inappropriate when (1) key assumptions of the model are either unchecked or grossly violated, and (2) no attempt is made to identify the decision maker's goals, values, and task assumptions. Methodologically, the current approach is criticized for its failure to consider how the ambiguous, unreliable, and unstable base rates of the real world are and should be used. Where decision makers' assumptions and goals vary, and where performance criteria are complex, the traditional Bayesian standard is insufficient. Even where predictive accuracy is the goal in commonly defined problems, there may be situations (e.g., informationally redundant environments) in which base rates can be ignored with impunity. A more ecologically valid research program is called for. This program should emphasize the development of prescriptive theory in rich, realistic decision environments.

    Original languageEnglish (US)
    Pages (from-to)1-53
    Number of pages53
    JournalBehavioral and Brain Sciences
    Volume19
    Issue number1
    DOIs
    StatePublished - 1996

    Keywords

    • Bayes theorem
    • base rates
    • fallacy
    • judgment
    • natural ecology
    • probability

    ASJC Scopus subject areas

    • Neuropsychology and Physiological Psychology
    • Physiology
    • Behavioral Neuroscience

    Fingerprint Dive into the research topics of 'The base rate fallacy reconsidered: Descriptive, normative, and methodological challenges'. Together they form a unique fingerprint.

    Cite this