Glossarytaught in M6.04
Availability heuristic
Also called availability bias.
Judging the probability of an event by how easily examples come to mind, which is driven by vividness and coverage rather than by frequency.
Investors overestimate the probability of dramatic events that get reported widely and underestimate slow, undramatic ones. So fraud risk feels high after a fraud is reported and low the rest of the time.
Base rates are the corrective, and they are almost always available for the questions that matter.
Count the cases. Memory picks the vivid ones and forgets the rest.