The large role of noise in error contradicts a commonly held belief that random errors do not matter, because they “cancel out.” This belief is wrong. If multiple shots are scattered around the target, it is unhelpful to say that, on average, they hit the bull’s-eye. If one candidate for a job gets a higher rating than she deserves and another gets a lower one, the wrong person may be hired. If one insurance policy is overpriced and another is underpriced, both errors are costly to the insurance company; one makes it lose business, the other makes it lose money.
