From the casino to the jungle

Abstract

Clear-cut cases of decision-making under risk (known probabilities) are unusual in real life. The gambler’s decisions at the roulette table are as close as we can get to this type of decision-making. In contrast, decision-making under uncertainty (unknown probabilities) can be exemplified by a decision whether to enter a jungle that may contain unknown dangers. Life is usually more like an expedition into an unknown jungle than a visit to the casino. Nevertheless, it is common in decision-supporting disciplines to proceed as if reasonably reliable probability estimates were available for all possible outcomes, i.e. as if the prevailing epistemic conditions were analogous to those of gambling at the roulette table. This mistake can be called the tuxedo fallacy. It is argued that traditional engineering practices such as safety factors and multiple safety barriers avoid this fallacy and that they therefore manage uncertainty better than probabilistic risk analysis (PRA). PRA is a useful tool, but it must be supplemented with other methods in order not to limit the analysis to dangers that can be assigned meaningful probability estimates.