Statistical Illusions Entry #0428 Classified Declassified

Why a ninety-nine per cent accurate test is usually wrong

A test that is right ninety-nine times in a hundred can still be wrong about most of the cases it flags, and simple arithmetic shows why.

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Plate 27 — one alert, ten thousand records, and a number nobody supplied.

Intuition test — answer before you read on

A test with ninety-nine per cent accuracy looks for something present in one case per thousand. Roughly how often is a flag correct?

A fraud detector is described as ninety-nine per cent accurate. It flags an account. The intuitive conclusion is that the account is almost certainly fraudulent. Where fraud is rare, the opposite is nearer the truth, and the detector has made no error at all.

What everyone sees

Accuracy is heard as the probability of being right about this case. Ninety-nine per cent accurate is taken to mean ninety-nine per cent likely correct whenever the instrument speaks, which makes the rarity of the target feel like a technicality rather than half of the calculation.

What is actually happening

Work it through with ten thousand accounts, ten of them fraudulent. The detector catches about ten of the ten and wrongly flags about one per cent of the remaining 9,990, which is roughly a hundred. So about a hundred and ten accounts are flagged and about ten of those are genuine cases: fewer than one in ten. Nothing about the instrument changed, only the rarity of what it looks for.

Why it stays hidden

The base rate is missing from the sentence that reaches the decision-maker. Accuracy is one number and travels well; prevalence is a second number held by somebody else, so the two rarely meet. Studies of this arithmetic have found trained professionals reaching the intuitive answer under time pressure, and the error largely disappears when the same problem is stated in counts instead of percentages.

Accuracy is a property of the test. Whether an alert is right also depends on how rare the thing is.

Accuracy is a property of the test. Whether an alert is right also depends on how rare the thing is.

The hidden part — entry #0428

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Accuracy is a property of the test. Whether an alert is right also depends on how rare the thing is.

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Sources & further reading 3
  1. Casscells, Schoenberger & Graboys, "Interpretation by Physicians of Clinical Laboratory Results", New England Journal of Medicine, 1978
  2. Eddy, "Probabilistic Reasoning in Clinical Medicine", in Judgment under Uncertainty, 1982
  3. Gigerenzer & Hoffrage, "How to Improve Bayesian Reasoning Without Instruction: Frequency Formats", Psychological Review, 1995

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