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Posts Tagged ‘Prediction’

Who Needs a Crystal Ball to See the Future When Hindsight Bias Makes You Feel as if You Knew it All Along

November 25th, 2019 1 comment

“I just can’t stand it anymore!” For the last two weeks, this has been Katie’s way of announcing to her mother that she is home from school. Why is Katie so upset? I’ll give you a hint- it’s March of her senior year and she is waiting on something…

You’re probably thinking, oh college decisions! That must be what she is waiting for.

Good guess, but this is something much more nerve-wracking.

She’s waiting for her crush to ask her to the senior prom.

“What happened today, sweetheart?,” her mom asked. “Ok, so it was during lunch and I was standing in front of Drew in the sandwich line. I totally saw him checking me out, so I thought, ‘might as well flash a smile his way’, so I smiled AND said hi to him. And you know what he did back? NOTHING. He pretended like I didn’t exist! Can you believe him?!”

“Well, maybe he didn’t see you Katie. I wouldn’t worry about it; I’ve seen the way he looks at you. Drew clearly likes you.” Katie groaned. “Sorry mom, but I think you’re wrong on this one. I’m just going to accept the fact that he NEVER is going to ask me out.”

“Just wait it out Katie; you always try to control the situation, but sometimes matters like this need time to work themselves out.” Katie rolled her eyes. “No, I think I’m just destined to live alone my whole life with only cats to keep me company. The sooner I accept reality the better.”

*One Week Later, Katie’s on the phone while walking into the house*

“Brittany, I know, what can I say, it was only a matter of time before he was going to ask me. Have you noticed the way he looks at me? I’ve known he was going to ask me the whole time.”

Katie may feel as if she knew it all along but she’s not fooling us…

“Katie, is that you? Did I just hear you say Drew finally asked you to the prom? This is so exciting! I told you not to worry.”

“Brittany, give me a second my mom is talking to me. What do you mean, worry? I’ve known he was going to ask me all along.”

*Katie leaves the room*

“Knew it all along huh?” Katie’s mom picked up an advertisement addressed to Katie from the counter. “I guess she won’t be needing this cat poster of the month subscription anymore”.

Like Katie’s mom, you may be confused as to why Katie suddenly feels as if she knew Drew was going to ask her all along when it’s evident she didn’t.

One possible explanation is hindsight bias.

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Elude the Illusion: Understand The Illusion of Validity So You Don’t Fall Victim To This Common Decision Making Bias

April 27th, 2018 2 comments

The illusion of validity will often cause people to make risky bets on a roulette wheel

Have you ever placed a bet that a certain number will appear on dice or a roulette wheel? Maybe a number has come up repeatedly so you assume that there is less of a chance that this number will appear in the next roll or spin, even though every number has an equal probability of coming up. Many people fall victim to this bias and end up losing money at casinos. This phenomenon can be explained by the illusion of validity. Defined as a person’s tendency to overestimate their accuracy in making predictions given a set of data, the illusion of validity is one common source of bias in decision making (Einhorn, 1978).

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