A Note on Inferential Decisions, Errors and Path-Dependency

Abstract

Consider the sequential testing of binary outcomes. The a posteriori belief process and its objective conditional-probability counterpart generally differ but converge to the same result in well-defined tests. We show that unless the two processes are 'essentially identical', differing only by an a priori factor, time-homogeneous continuous decisions based on the former are path-dependent with respect to state-variables based on the latter or any other non-essentially-identical processes. Inferential error decomposes into a path-dependent and a path-independent component, whose distinct properties are relevant to error mitigation.