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Thanks for a clear explanation of 'base rate fallacy' or 'bias'. I have never actually heard the phenomenon given that name, but this has been confusing for a lot of people for a long time, since well before COVID. When I explain it, I usually add the observation that cases arise among those who are susceptible. In a population where an imperfect vaccine has been used, and where infection confers immunity, the susceptible population is the sum of two groups: those not yet infected and unvaccinated; and those in whom the vaccine did not 'take'. As vaccine coverage goes up, the number of people in the population with vaccine failure goes up, and the fraction of susceptibles who are vaccine failures goes up. As you point out, in a population that is 100% vaccinated with an imperfect vaccine, all the susceptibles and thus all the cases will be among the vaccinated.

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