Monthly Archives: March 2003

Bad Outcomes vs. Bad Decisions

Only a fool assumes that bad outcomes are always a sign of bad decisions. If you play Russian Roulette with 5 of 6 chambers full, and don’t blow your head off, you still made a bad choice.

When we get a bad outcome based on a good choice, we often incorrectly “learn” that we made a bad choice. It is even worse when we get good outcomes from bad choices — we “learn” that we made a good choice. Real learning requires that we clearly distinguish the decision from its outcome, and such learning is critical in a stochastic world.