Two types of error that influence decision-making

When it comes to accuracy in decision-making, there are two types of error:

• Bias, which is an average error
• Noise is the variability of error.

For example:

In a noisy system, judges give vastly different sentences to defendants who committed the same crime. Some judges give a one-month sentence, others one year, others seven years, and others somewhere in between.

In a biased system, judges might consistently give sentences too high for certain crimes.

In many situations, noise is a more severe source of inaccuracy and error than bias.