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Availability Bias

In: Business and Management

Submitted By manojm
Words 4725
Pages 19
Table of Contents

Availability Bias 2
Overreaction Bias 6
Research Report Analysis 8
Illustrations 12
Conclusion 14
Bibliography 15

Availability Bias
Availability bias is a human cognitive bias that causes us to overestimate probabilities of events associated with memorable or dramatic occurrences. A cognitive bias is a pattern of deviation in judgment that occurs in particular situations. A cognitive bias can also be explained as a flaw in judgment which is caused by memory, social attribution, and statistical errors. Since, memorable events are further magnified by coverage in the media; the bias is compounded on the society level. Two well-known examples would be estimations of the probability of plane accidents and the kidnap of children. Both events are quite rare, but the huge majority of the population outrageously overestimates their probability, and behaves accordingly.
In reality, one is more likely to die from an auto accident than from a plane accident, and a child has a higher risk of dying in an accident than the risk of getting kidnapped. Availability bias is at the root of many other human biases and culture-level effects. Availability bias is a cognitive illusion.
The availability biasis a mental shortcut that occurs when people make judgments about the probability of events by how easy it is to think of examples. The availability bias operates on the notion that, "if you can think of it, it must be important." The availability of consequences associated with an action is positively related to perceptions of the magnitude of the consequences of that action. In other words, the easier it is to recall the consequences of something, the greater we perceive these consequences to be. Sometimes, this heuristic is beneficial, but the frequencies that events come to mind are usually not accurate…...

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