Correspondence Bias is a tendency to attribute to a person a disposition to behave in a particular way, based on observing an episode in which that person behaves in that way. The data set that gets considered consists only of the observed episode, while the target model is of the person's behavior in general, in many possible episodes, in many different possible contexts that may influence the person's behavior.
Discuss the post here (rather than in the comments to the original post).
This post is part of the Rerunning the Sequences series, in which we're going through Eliezer Yudkowsky's old posts in order, so that people who are interested can (re-)read and discuss them. The previous post was Risk-Free Bonds Aren't, and you can use the sequence_reruns tag or rss feed to follow the rest of the series.
Sequence reruns are a community-driven effort. You can participate by re-reading the sequence post, discussing it here, posting the next day's sequence reruns post, or summarizing forthcoming articles on the wiki. Go here for more details, or to have meta discussions about the Rerunning the Sequences series.