Monday, January 10, 2011

On Overconfidence

There is one general lesson from evolution that helps us identify when overconfidence is likely to lead us astray. Our judgment and decision-making mechanisms evolved to deal with the adaptive problems of our evolutionary past, not with the problems of our modern social and physical world. Our brains developed over millions of years, during much of which we lived in small kin groups of hunter-gatherers. It is only in the past 10,000 years that we began living with strangers in large urban societies, organizing ourselves into hierarchical political units, and operating complex machines and lethal weapons. Although overconfidence may often continue to help us just as evolution intended—in relevant contexts and settings—it has a powerful and pervasive evolutionary legacy that continues to dominate our judgment and decision-making, even in complex political, social, or technological settings when such overconfidence is far less likely or able to bring any advantages and simply increases the chance of disaster.
We can predict, therefore, that overconfidence is most likely to help in “evolutionarily salient” contexts that are similar to the adaptive challenges of our past, such as individual combat like boxing. It is least likely to help in “evolutionarily novel” contexts—such as sitting at a desk in a bank guessing the behavior of 100 million strangers, or commanding thousands of invisible troops from an underground bunker.
The good news is that evolutionary reasoning suggests ways to avoid the most dangerous situations in which overconfidence is likely to arise. First, we can make sure that overconfidence is nurtured in settings where a go-getting attitude helps performance (such as sports), and suppressed in settings where accurate assessment is more important than will (such as global climate change). Second, we can target the underlying contexts that make or break overconfidence. For example, notice that we exhibit overconfidence only when we are not sure who will win a fight. This suggests that we should be encouraging as much information sharing as possible—the more interaction we have with our opponents, the more likely we are to agree on the strengths and weaknesses of each side. This is precisely the reasoning underlying recent calls for mutual inspections of nuclear arms facilities between Russia and the US.

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