Historian Barbara Tuchman, in The March of Folly: From Troy to Vietnam, describes an act of folly as a self-destructive act made by a group of people, even when a clear alternative is available, and at least some people at the time are aware of the self-destructiveness of the act. She uses Troy's acceptance of the legendary Greek gift horse as the prototypical example of folly.
Of course, in real life, things are rarely so clear-cut, and it's easy for historians to say "Well, obviously these people were right and these people were wrong." Still, it would have been pretty easy at least to examine the horse for signs of occupants. Given that there were a number of warnings about it, what would have been the harm?
The harm, apparently, was the risk of offending Athena, to whom the horse was dedicated. That brings a whole different dimension to the question of whether or not accepting the horse was folly. When you think you're at the mercy of powerful, inconsistent and self-serving gods, trying to make a rational decision is pretty tough.
Anyway, depending on whose perspective you have, the Trojan horse could be considered either a great idea or a dumb one.
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