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What is noise? How does it enter into human judgment and enhance errors in decision making?In this Social Science Bites Podcast, Olivier Sibony, co-author of Noise: A Flaw in Human Judgment, defines the concept of noise as the 'unwanted variability in human judgment' causing errors in our thinking. After bias has been identified in professional judgments, the undesirable variability of faults (that is, noise) remains. Sibony goes on to explain why it is important for us to understand what noise is, how it is mathematically equivalent to bias and how to mitigate its negative effects on our judgment.Sibony discusses the range of areas in which statisticians can identify noise, using examples such as the cost and claim estimates of insurance companies, how professors grade essays and how a judge decides the sentence for a person who has been found guilty of a crime. This is particularly important because 'when similarly situated people are not treated similarly, it's unfair'. Decisions can have incredible effects on those who are involved, and many outcomes are a lottery, as they are reliant on those who happen to be put in charge of making the decisions. This in turn makes the credibility of the decision-making institution questionable.

Judgment. --- Decision making.