Updated: Dec 8, 2021
Our battle with probability
We struggle with probabilities. Casinos and bookies take advantage of our weakness, while insurers protect us against it. We underestimate near certainties as easily as we overestimate the unlikely, the remote and the frankly impossible. We are estimating probabilities almost continuously in our daily lives , usually without any insight into the process. Why do we ascribe so much attention to a 1 in a million risk or opportunity. Maybe it is just a problem of framing – tell someone that the chances of winning the Euromillions this week (1 in 5 million) is the same as getting 22 heads in a row on a coin, and watch those sales tumble.
And yet, over the last year we have heard more about probability and risk than any prior year (after leaving school). From the likelihood of needing hospital treatment after COVID infection to very rare immune reactions to vaccination. A reasonable question is whether this heightened salience has changed either our perception of risk or our behaviours. In short, how has COVID affected our struggle with probability?
A study of 3.5 million Twitter users in the USA attempted to develop indicators for three aspects of risk perception using 297 million tweets over the period January-October 2020 (more). The indicators were perceived severity, perceived susceptibility and negative emotion. As the tweets were geotagged, it was also possible to look at trends in different socio-demographics.
Each indicator had a unique trajectory, with perceived severity increasing throughout the period of the study, possibly reflecting growing awareness through a multitude of news flashes. But interestingly, there was no clear correlation between any of the indicators and actual risk as denoted by epidemic indicators such as daily new cases and new deaths. Perception driven by soundbite, not reality. That said, high scores for perceived severity and susceptibility were correlated with median household income and high prevalence of health insurance.
We will return to this topic in future weeks with more studies and insights.
Estimating global risk
It is difficult not to be overly influenced by the recent. Even experts struggle. The annual Global Risks Report from the World Economic Forum provides a Delphic view of the most worrying risks facing governments, industry and society in terms of likelihood and impact. It will come as no surprise that the 16th annual report (more) released earlier this year has infectious diseases and climate action failure as the two risks at the top right of the chart (see Figure 2.1). And yet, 11 years ago after the largely forgotten 2009 influenza pandemic (more), infectious diseases (30) and pandemics (29) were only in the middle of the pack (see Figure 2.2). Are we more or less right now than we were then? You might say that only time will tell, but we only ever to get to play out one scenario.
Figure 2.1 – Impact and likelihood of global risks – 16th annual Global Risk Report
Source: World Economic Forum
Figure 2.2 – Impact and likelihood of global risks – Global Risks 2010
Source: World Economic Forum