Uncertain about uncertainty

One of the key theories that informs our teaching and research into BI at Monash comes from cognitive science. It states that, for a whole variety of reasons, people don't make rational decisions. Instead, we're subject to so-called cognitive biases. One category of bias has to do with how we think about statistics - as a rule, people are terrible at thinking in ways that are consistent with the laws of Bayesian probability. This is a real problem for BI developers, since most BI tools deal with quantitative values, and hence, statistics and probability. Even worse, just about everyone is subject to these biases, even trained mathematicians, and presumably, BI professionals.

I've just finished watching an excellent talk by statistician Peter Donnelly that covers this issue brilliantly. It's one of the recent TED podcast episodes, that I've referred to before, and runs for about 20 minutes.



If you want to find out more about some of the other (really freaky) cognitive biases that exist, check out our bias page at http://olap.sims.monash.edu.au/research/decision.nsf.