Originated by Thomas Bayes (An Essay towards Solving a Problem in the Doctrine of Chances, 1763) and, independently, Pierre-Simon Laplace (1774).
Revises how likely a belief is when new evidence arrives, by weighing the starting estimate against how much more likely the evidence is if the belief is true.
When to reach for it
New information has come in (a test result, an alert, a due diligence finding), and the question is how far it should move the current view.
How it runs
- State the hypothesis and its alternative.
- Set a starting probability from base rates.
- Ask how likely the evidence is under each.
- Multiply the starting odds by that ratio.
- Repeat for each independent piece of evidence.
Where it sits in SOLVE eX
- Any step: Tools that serve every step: habits of thought and checks on the thinking itself.
Go to the source
- An Essay towards Solving a Problem in the Doctrine of Chances, Philosophical Transactions of the Royal Society, 1763
- Mémoire sur la probabilité des causes par les événements, 1774