Balancing risk of mistakes

[Jean-Marie Gogue <jmegogue@wanadoo.fr>]

'Either mistake causes loss. We can avoid either mistake, but not both.
Anyone may set for himself a perfect record from this hour henceforth never
to make Mistake 1. Attribute to common causes any undesired result. Nothing
could be simpler. But in doing so, he would maximize his loss from Mistake
2. Likewise, anyone may set for himself a perfect record from this hour
henceforth never to make Mistake 2. This too would be easy: attribute to a
special cause any undesired result. But in doing so, he would maximize his
loss from Mistake 1. Unfortunately, it is impossible to reduce both
mistakes to zero. Dr' Shewhart's next contribution was to conclude that the
best that we can do is to make Mistake 1 now and then, and Mistake 2 now
and then, both preferably rarely, following rules that will over the long
run minimize the net economic loss from both mistakes.' Quoted from W.
Edwards Deming, The New Economics, second edition, page 175.

In politics, some countries change their Constitution frequently in order
to avoid mistake 2. They attribute to a special cause any undesired result
in elections. On the contrary other countries never change their
Constitution. They attribute to common causes any undesired result in
elections. This can result in a big mess.

Best wishes,

Jean-Marie Gogue
Versailles  France
jmegogue@wanadoo.fr