{"id":1704,"date":"2026-01-09T18:27:04","date_gmt":"2026-01-09T18:27:04","guid":{"rendered":"https:\/\/www.allendowney.com\/blog\/?p=1704"},"modified":"2026-01-09T18:27:06","modified_gmt":"2026-01-09T18:27:06","slug":"bayesian-decision-analysis","status":"publish","type":"post","link":"https:\/\/www.allendowney.com\/blog\/2026\/01\/09\/bayesian-decision-analysis\/","title":{"rendered":"Bayesian Decision Analysis"},"content":{"rendered":"\n<p>At <a href=\"https:\/\/pydata.org\/global2025\">PyData Global 2025<\/a> I presented a workshop on Bayesian Decision Analysis with PyMC.  The video is available now.<\/p>\n\n\n\n<p>This workshop is based on the first session of the Applied Bayesian Modeling Workshop I teach along with my colleagues at PyMC Labs. If you would like to learn more, it is not too late to <a href=\"https:\/\/www.pymc-labs.com\/workshops\/applied-bayesian-modeling\">sign up for the next offering, starting Monday January 12<\/a>.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<span class=\"embed-youtube\" style=\"text-align:center; display: block;\"><iframe loading=\"lazy\" class=\"youtube-player\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/6yVIlWGNoGI?version=3&#038;rel=1&#038;showsearch=0&#038;showinfo=1&#038;iv_load_policy=1&#038;fs=1&#038;hl=en-US&#038;autohide=2&#038;start=77&#038;wmode=transparent&#038;listType=playlist&#038;list=PLGVZCDnMOq0qmerwB1eITnr5AfYRGm0DF\" allowfullscreen=\"true\" style=\"border:0;\" sandbox=\"allow-scripts allow-same-origin allow-popups allow-presentation allow-popups-to-escape-sandbox\"><\/iframe><\/span>\n<\/div><\/figure>\n\n\n\n<p>Resources:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/docs.google.com\/presentation\/d\/e\/2PACX-1vRvEsesD79gYlNdeH--T8e2Fnpi6GXGtW-8Oqv-3wOOnIILLWWDUrk5lKBwWUxei5sJkSf2euyMZNfu\/pub\">The slides are here<\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/github.com\/AllenDowney\/BDAwithPyMC\">The GitHub repository with the workshop material is here<\/a><\/li>\n\n\n\n<li>You can run the notebooks on Colab: <a href=\"https:\/\/colab.research.google.com\/github\/AllenDowney\/BDAwithPyMC\/blob\/main\/notebooks\/01_beta_binomial.ipynb\">notebook without solutions<\/a>, <a href=\"https:\/\/colab.research.google.com\/github\/AllenDowney\/BDAwithPyMC\/blob\/main\/solutions\/01_beta_binomial.ipynb\">notebook with solutions<\/a><\/li>\n<\/ul>\n\n\n\n<p>Here&#8217;s the abstract and description of the workshop.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Bayesian Decision Analysis with PyMC: Beyond A\/B Testing<\/h3>\n\n\n\n<p>This hands-on tutorial introduces practical Bayesian inference using PyMC, focusing on A\/B testing, decision-making under uncertainty, and hierarchical modeling. With real-world examples, you&#8217;ll learn how to build and interpret Bayesian models, evaluate competing hypotheses, and implement adaptive strategies like Thompson sampling. Whether you&#8217;re working in marketing, healthcare, public policy, UX design, or data science more broadly, these techniques offer powerful tools for experimentation, decision-making, and evidence-based analysis.<\/p>\n\n\n\n<p><strong>Description<\/strong><\/p>\n\n\n\n<p>Bayesian methods offer a natural and interpretable framework for updating beliefs with data, and PyMC makes it easy to apply these techniques in practice. In this tutorial, we\u2019ll walk through a series of examples that demonstrate the core concepts:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li>Bayesian A\/B Testing with the Beta-Binomial Model<\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Represent prior beliefs with the beta distribution<\/li>\n\n\n\n<li>Use binomial likelihoods to model observed outcomes<\/li>\n\n\n\n<li>Understand posterior distributions and credible intervals<\/li>\n<\/ul>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li>Bayesian Bandits and Thompson Sampling<\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Go beyond hypothesis testing: estimate the probability of one version outperforming another<\/li>\n\n\n\n<li>Use Thompson sampling to guide decision-making<\/li>\n\n\n\n<li>Simulate and visualize an adaptive email campaign<\/li>\n<\/ul>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li>Hierarchical Models for Partial Pooling and Prediction<\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Learn how to share information across variants<\/li>\n\n\n\n<li>Use posterior predictive distributions to quantify uncertainty<\/li>\n\n\n\n<li>Understand second-order probabilities<\/li>\n<\/ul>\n\n\n\n<p>Hands-On Learning<\/p>\n\n\n\n<p>Participants will follow along in Jupyter notebooks (hosted on Colab \u2014 no installation required). Exercises are embedded throughout, with guided solutions. Code is based on PyMC, ArviZ, and standard scientific Python libraries.<\/p>\n\n\n\n<p>Prerequisites<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Intermediate Python: basic familiarity with NumPy, plotting, and Jupyter notebooks<\/li>\n\n\n\n<li>No prior experience with Bayesian statistics or PyMC is assumed<\/li>\n\n\n\n<li>All materials run on Colab (no setup required)<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>At PyData Global 2025 I presented a workshop on Bayesian Decision Analysis with PyMC. The video is available now. This workshop is based on the first session of the Applied Bayesian Modeling Workshop I teach along with my colleagues at PyMC Labs. If you would like to learn more, it is not too late to sign up for the next offering, starting Monday January 12. Resources: Here&#8217;s the abstract and description of the workshop. Bayesian Decision Analysis with PyMC: Beyond&#8230;<\/p>\n<p class=\"read-more\"><a class=\"btn btn-default\" href=\"https:\/\/www.allendowney.com\/blog\/2026\/01\/09\/bayesian-decision-analysis\/\"> Read More<span class=\"screen-reader-text\">  Read More<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1],"tags":[71,86,108],"class_list":["post-1704","post","type-post","status-publish","format-standard","hentry","category-uncategorized","tag-bayesian-statistics","tag-decision-analysis","tag-pymc"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Bayesian Decision Analysis - Probably Overthinking It<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.allendowney.com\/blog\/2026\/01\/09\/bayesian-decision-analysis\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bayesian Decision Analysis - Probably Overthinking It\" \/>\n<meta property=\"og:description\" content=\"At PyData Global 2025 I presented a workshop on Bayesian Decision Analysis with PyMC. 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When I was working in Cambridge I took the Red Line from\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.allendowney.com\/blog\/wp-content\/uploads\/2024\/07\/image-1.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":74,"url":"https:\/\/www.allendowney.com\/blog\/2018\/10\/18\/how-tall-is-a\/","url_meta":{"origin":1704,"position":3},"title":"How tall is A?","author":"AllenDowney","date":"October 18, 2018","format":false,"excerpt":"Here are a series of problems I posed in my Bayesian statistics class: 1) Suppose you meet an adult resident of the U.S. who is 170 cm tall. What is the probability that they are male? 2) Suppose I choose two U.S. residents at random and A is taller than\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":883,"url":"https:\/\/www.allendowney.com\/blog\/2023\/03\/20\/the-bayesian-killer-app\/","url_meta":{"origin":1704,"position":4},"title":"The Bayesian Killer App","author":"AllenDowney","date":"March 20, 2023","format":false,"excerpt":"It's been a while since anyone said \"killer app\" without irony, so let me remind you that a killer app is software \"so necessary or desirable that it proves the core value of some larger technology,\" quoth Wikipedia. For example, most people didn't have much use for the internet until\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/img.youtube.com\/vi\/fsdbneHgi58\/0.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":1593,"url":"https:\/\/www.allendowney.com\/blog\/2025\/09\/25\/the-poincare-problem\/","url_meta":{"origin":1704,"position":5},"title":"The Poincar\u00e9 Problem","author":"AllenDowney","date":"September 25, 2025","format":false,"excerpt":"Selection bias is the hardest problem in statistics because it\u2019s almost unavoidable in practice, and once the data have been collected, it\u2019s usually not possible to quantify the effect of selection or recover an unbiased estimate of what you are trying to measure. And because the effect is systematic, not\u2026","rel":"","context":"In &quot;Bayesian methods&quot;","block_context":{"text":"Bayesian methods","link":"https:\/\/www.allendowney.com\/blog\/category\/bayesian-methods\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.allendowney.com\/blog\/wp-content\/uploads\/2025\/09\/064e15e7bb9b7a88a9b4118964b00919934f5b1e6fe04ebd195cfbf9d7da40a9.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/posts\/1704","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/comments?post=1704"}],"version-history":[{"count":2,"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/posts\/1704\/revisions"}],"predecessor-version":[{"id":1706,"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/posts\/1704\/revisions\/1706"}],"wp:attachment":[{"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/media?parent=1704"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/categories?post=1704"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.allendowney.com\/blog\/wp-json\/wp\/v2\/tags?post=1704"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}