<ul data-eligibleForWebStory="true"><li>The Base Rate Fallacy is a bias causing humans and machines to misjudge probabilities when underlying probabilities are ignored.</li><li>It occurs when the base rate (overall probability of an event) is overlooked, and focus shifts only to new evidence.</li><li>Psychological factors like the representativeness heuristic contribute to humans falling for this fallacy by replacing hard questions with simpler judgments.</li><li>Bayes' Theorem offers a solution to counter the base rate fallacy by combining base rates with new evidence to update beliefs accurately.</li></ul>

The Base Rate Fallacy: Why Your Smartest Model Still Gets It Wrong

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