85% of cars are blue and 15% are green. A man witnesses a hit and run and says the car was green. he can accurately identify the colors 80% of the time.
What are the chances the car is green?
Usually, the people respond that the probability is 80%; when actually the correct answer is 41%.
We tend to assign greater value to specific information and ignore base rate information.
See the full study here :
Bar-Hillel, M. (1980). The base-rate fallacy in probability judgments. Acta Psychologica, 44(3), 211-233.Bar-Hillel, M. (1980).https://doi.org/10.1016/0001-6918(80)90046-3
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