Effects of outcome and trial frequency on the inverse base-rate effect

The inverse base-rate effect is a bias in contingency learning in which participants tend to predict a rare outcome for a conflicting set of perfectly predictive cues. Although the effect is often explained by attention biases during learning, inferential strategies at test may also contribute substantially to the effect. In three experiments, we manipulated the frequencies of outcomes and trial types to determine the critical conditions for the effect, thereby providing novel tests of the reasoning processes that could contribute to it. The rare bias was substantially reduced when the outcomes were experienced at equal rates in the presence of predictive-cue frequency differences (Exp. 2), and when the predictive cues were experienced at equal rates in the presence of outcome frequency differences (Exp. 3). We also found a consistent common-outcome bias for novel cue compounds. The results indicate the importance of both cue and outcome frequencies to the inverse base-rate effect, and reveal a combination of necessary conditions that are not well captured by appealing to inferential strategies at test. Although both attention-based and inferential theories explain some aspects of these data, no existing theory fully accounts for these effects of relative novelty.