0:03

Welcome to Stuff to Blow Your Mind, a production of I Heart

0:05

Radios How Stuff Works. Hey,

0:13

you, welcome to Stuff to Blow Your Mind. My name is Robert

0:15

Lamb and I'm Joe McCormick, and we're back with

0:17

part two of our discussion of overconfidence.

0:20

That's right. If you did not listen to the

0:22

previous episode, do go

0:24

back and listen to that episode, because we're gonna

0:26

lay the ground work. We're going to discuss over

0:29

confidence and hubrists and mythology

0:32

in human histories, and

0:34

then get into the psychology of it and

0:36

what various psychological studies have revealed

0:38

and continue to reveal about the nature

0:41

of over confidence and how we can divide this

0:44

sort of amorphous concept

0:46

of over confidence out into

0:48

categories that can be more easily studied

0:50

and understood. That's right now. In the last

0:53

episode, one of the main things we talked about was this

0:55

huge new review of the scientific

0:57

literature on something known as the better than average

0:59

effect, which is the tendency for people to

1:01

rate themselves as better than average

1:03

with respect to their peers on all

1:06

kinds of stuff. One classic example

1:08

is that something like ninety three percent

1:10

of people think they're a better than average

1:13

driver. So if you're if you're listening

1:15

to this as you drive, eyes back on the road,

1:17

and make sure you use this turn signals. Turn signals,

1:19

save lives, turn signals. Let

1:21

other drivers and pedestrians know what

1:24

you intend to do. Even if you think you're a great

1:26

driver, drive like you're less good than you

1:28

are, and it will make you a better driver. Drive

1:30

like you can't see all the other cars

1:32

and pedestrians around you, because sometimes you cannot

1:35

drive like you're driving a murder weapon, because

1:37

potentially you are. It's quite true, all

1:40

right. Now. One of the things we talked about in the last episode

1:43

was a paper from seventeen

1:45

by Don Amore and Derek Schatz called

1:48

the Three Faces of Overconfidence,

1:50

which which actually broke over

1:53

confidence down into three distinct

1:55

categories of of bias or

1:57

misperception and uh. And

1:59

we we talked about those a little bit last time. We're going to

2:01

be exploring more of what that paper had to say,

2:04

and it's critiques of overconfidence

2:06

research, specifically with reference

2:08

to these three types of overconfidence. And

2:10

as a brief refresher, the three types

2:12

are overestimation, overplacement,

2:15

and over precision. Overestimation

2:17

is thinking that you're better than you are, and

2:20

this would be with reference to some kind of uh,

2:22

you know, objective measure out in the world.

2:24

So if you think that you are taller

2:26

than you are, you know, if you think that you can

2:28

jump higher than you can, if you

2:30

think that you would get a better score on

2:33

a test than you actually could, that's

2:35

overestimation. The next one,

2:37

overplacement, is similar, but instead

2:39

it's comparing yourself with other people.

2:42

So the better than average effect would be an

2:44

example of overplacement. It's,

2:46

you know, thinking you are better than average

2:49

compared to your peers at some task.

2:51

Or it would be thinking that you know that

2:54

you work harder than other people, or

2:56

thinking that you are smarter than

2:58

other people. Of course, with the if,

3:00

it's over confidence, meaning that those are not actually

3:02

accurate assessments. And then

3:04

finally the other one would be over precision,

3:07

which is being too sure that you know the

3:09

truth. Again, this this might

3:11

be called epistemic over confidence. It's

3:13

just being too certain that your beliefs

3:15

are correct. Now, to get into more

3:18

in chats is paper from.

3:21

One of the questions that they address is

3:23

what actually drives some of

3:25

these different effects as as they

3:27

are manifested so they start

3:29

with overestimation. What causes

3:32

us to say think we would get a better

3:34

score on a test than we do, or to think

3:36

we have more money in the bank than we do.

3:39

A common answer that people give to this

3:41

is the idea of wishful thinking. It

3:44

would feel good if this were true, therefore

3:46

I believe it. Right. Uh. The authors

3:49

don't think that this explanation is

3:51

very plausible, and they offer several problems

3:53

with it, and we can interrogate these, maybe

3:55

disagree with them as we go on. But first

3:57

of all, they say, you know, self delusion is

4:00

demonstrably maladaptive. For

4:02

example, a tendency toward wishful

4:04

thinking about the safety of kissing sharks

4:06

so with tongue is not a trait that

4:09

the environment will tend to select for. People

4:11

overconfident about their academic abilities

4:14

will tend not to study and actually do

4:16

worse. People who believe themselves

4:18

invulnerable will take risks that sometimes

4:21

get them killed. This might seem obvious,

4:23

but there is actually plenty of research on this.

4:25

I mean, people who are overconfident about

4:27

their abilities do face a

4:29

lot of downsides when those abilities are

4:31

put to the test. Yeah, I mean, one

4:34

example from literature that comes to mind is

4:36

that of Macbeth, who believes

4:39

himself protected by prophecy um

4:41

and then of course uh snuffs

4:44

it because yeah, exactly. But

4:46

then again, I think, okay, so it is

4:48

true that these people will face a lot of downside,

4:51

But then again, people

4:53

do engage in self destructive,

4:55

self deluded behavior all the time. I

4:57

mean, this is a common feature of human life. Yeah

4:59

we I mean, for instance, we were just recently

5:01

talking about the Placebo effect on our movie

5:04

episode where we talked about the fly and

5:07

and about the possibility that the Polacebo

5:09

effect is basically due

5:11

to uh, you know, this innate

5:13

tendency towards self delusion that

5:16

may very well be adaptive. And at least in this

5:18

scenario, um, where yeah,

5:21

we we benefit from being able

5:23

to believe something is going to work

5:25

and and uh and and and experiencing

5:29

at least a small physical benefit from

5:31

it, like a small curative benefit from

5:33

it. And then um, you

5:35

know, I also can't help but think that,

5:37

you know, self delusion entails

5:39

far more than just over confidence. It also

5:42

entails all manner of paranoia. And

5:44

there is a strong case for the adaptive

5:46

nature of say making a type one error

5:48

in cognition, a false positive, the

5:51

belief that the rustle in the tall grass is

5:53

that of a tiger when it's not, because

5:55

if you make the type two uh

5:58

or, you're more likely to be eaten by the tiger.

6:01

Right, right, Yeah, having accurate information

6:03

about the world is actually very useful,

6:05

and having inaccurate information can kill

6:07

you. Yeah, but but I'm not so

6:09

much you know, trying to to disagree with the maladaptive

6:12

self delusion argument that

6:14

we mentioned earlier, but but rather you know,

6:16

to point out that the human experiences is rife

6:19

with self delusions. So might a dash

6:21

of overconfidence, even in the form of overestimation,

6:24

served to balance outh this alchemy

6:27

of you know, of our perception of reality.

6:29

For example, so you have a karaoke singer,

6:32

and granted karaoke is very low stakes,

6:34

but you could involve social embarrassment,

6:37

which you could fear would lead to ostracism,

6:40

and that's actually one of the most powerful negative

6:42

motivators on human behavior. Right, But

6:44

again, at karaoke is also one of these things where

6:46

like sometimes it's cool to do it badly. So this is

6:49

not a perfect example, but so you

6:51

have a kara karaoke singer that imbibes

6:53

in a little liquid courage before taking the

6:55

microphone, as most karaoke participants

6:58

are are are wont to do. Uh,

7:01

but yeah, they get a little liquid courage because

7:03

they know they don't have the greatest voice in the world.

7:05

And then they feel a little awkward getting up there.

7:07

But but they know that a little bit of booze

7:09

induced over confidence might help matters.

7:11

I think you're exactly right there, and this this is funny

7:14

to start here because I think while the authors make

7:16

tons of good points, this is one of the ones they

7:18

make that I might disagree with the most.

7:20

I think that there are antagonistic

7:22

adaptations in human behavior. One

7:25

pressure might favor having an accurate

7:27

picture of the world, assessing things in a clear

7:29

and accurate way, while a cross pressure

7:31

favor self deception, especially

7:33

self deception in the form of over confidence.

7:36

For example, you might be more

7:38

likely to survive if you have accurate

7:41

assessments of your own abilities, but

7:43

you might be more likely to take big

7:45

risks with potentially big rewards

7:47

if you overestimate your abilities or

7:50

self delusional. Over Confidence could be adaptive

7:53

because it helps us persuade or

7:55

even deceive other people about our worth.

7:58

Yeah, Ultimately you

8:00

have to you have to believe in yourself

8:02

if you know other people are not going to believe in you for

8:04

you, right right. I mean, we we talked in

8:07

the last episode about how it's probably

8:09

not a coincidence that you really often

8:11

notice over confidence in people who

8:13

occupy high status leadership roles.

8:16

How they get there. I mean, it's not hard to

8:18

imagine the overconfidence helped them get

8:20

to that point. Yeah, and it's, uh, sometimes

8:22

it's a fun, sometimes terrifying exercise to

8:25

like if you if you engage

8:27

with people like this and then when you realize, oh, they're

8:29

just really overconfident, they don't they're

8:32

they're not to say they're not skilled, but when you

8:34

realize they're not. Sometimes

8:36

they're not. But sometimes you really you realize, oh,

8:38

there there is this gap between ability

8:41

and uh and and and what they're

8:44

they're saying they're going to deliver on or what they

8:46

are estimating the future will consist of. Yeah,

8:48

I mean, I it is

8:51

kind of shocking how often in life

8:53

you will suddenly come to a realization

8:55

that you know, the boss or the leader

8:57

or whatever's main skill is b essing,

9:00

like that they can just go out there and wing

9:02

it in a way that you would be too timid

9:04

and reserve to do. Right now,

9:06

this idea of you know, accurate assessments

9:08

playing into our our own abilities, I

9:11

couldn't help but think of the film Butch Casting

9:14

and the Sun Dance Kid in this scenario,

9:17

because it really as it relates to two

9:19

specific points in the film. One

9:21

is the whole would you make that jump if

9:23

you didn't have to scenario where they're

9:25

being tracked, they're being hunted, and they've

9:27

come to this, uh, this this cliff overlooking

9:30

this river, and they realize

9:33

that if they jump, if they jump off

9:35

this cliff and they land in that river and they don't

9:37

die, they'll get away because

9:40

the stakes are such that those pursuing them will

9:42

not follow them, they will not make that jump

9:44

if they don't need to. Um.

9:47

So, so so there's

9:49

there's that, and then at the very end there's kind

9:51

of a going out the old fashioned way guns

9:54

ablazing scenario where they're cornered, they're going

9:56

to slowly be killed and they decided

9:58

to just go for it, to just bust out shooting

10:00

and just fight. Right.

10:03

So, so the incentives, like the

10:05

evolutionary incentives on a brain

10:07

generating accurate pictures of the world

10:10

versus self deluded over confidence.

10:13

Those could very well be just the contrast

10:15

between a low risk, low reward

10:17

strategy versus a high risk, high reward

10:19

strateke right, Yeah, so yeah, the first example

10:21

definitely high risk, high reward. Like

10:24

it was pretty much their only, their

10:26

best option for survival at that point,

10:29

and they took it, and in the film they survive.

10:32

At the end of the film, it's pretty much implied

10:34

that they die. But

10:36

but at the same time, it's it

10:38

still seems to be their best option, if not their

10:40

best option for surviving. It's

10:43

kind of at least a like the psychological

10:45

best option. You know, are we gonna stay in here

10:47

and die like rats, or are we gonna you

10:50

know, just burst out there and you

10:52

know, die like heroes in a film

10:54

that is named after them. You know, man,

10:57

that's a great movie. I want to go back and why I haven't seen

10:59

the Garsh remember, except

11:01

the end, I mean, the ending is kind of a downer, but uh,

11:04

but yeah, it's it's it's surprisingly

11:06

sweet for for a violent outlaw movie.

11:08

Yeah, it's a good one. And you

11:10

know, I mentioned Macbeth earlier in the whole idea

11:12

of you know, draping himself in prophecy and using

11:15

that to to to to pump

11:17

himself up. But that doesn't bring

11:19

up bring to mind the role of religion and all

11:21

of this, you know, I mean certainly a lot

11:24

of the things that religion can

11:26

do to your estimation

11:29

of ability or you know, uh,

11:31

you know, it can revolve around you know, the survivability

11:34

of the soul for example, you know, and

11:36

like what will happen if I act a

11:39

certain way in life? Yeah, and I think

11:41

there could possibly be cross pressure is going

11:44

the same way with that. I mean that that there

11:46

are some evolutionary drawbacks and some

11:48

some advantages to it, right. And then of course that's

11:50

not to say that religious motivations,

11:53

uh, you know exist free of social

11:56

of course, I guess you know, there's going to be a rich interplay

11:58

between those, and that's you know, that's

12:01

something that comes up, for instance, in um

12:03

when you look at studies of say, suicide bombers,

12:06

you know, where on one hand, you can look at

12:08

it and just go with the simple scenario of oh,

12:10

here's a person who believes that if they die

12:13

doing this act, then they'll be rewarded in

12:15

the afterlife. But then behind that there's

12:17

a whole social scenario as well of

12:20

other humans, you

12:22

know, telling them that this is the thing to do, et

12:25

cetera. Yeah, motivations are are a rich

12:28

stew of many different influences.

12:30

I mean, it's usually hard to nail down a

12:32

single inciting incident or cause

12:35

that lead people down a path in life.

12:37

And in fact, I think a lot of times even when people do

12:39

that with themselves and say this was the reason

12:42

I became or whatever I did, whatever, I think

12:44

a lot of times they're over some they're they're wrong about

12:46

themselves. Yeah, so basically

12:48

self delusion, we're all just houses

12:51

of cards, just

12:53

ready to be knocked down at any point. Well,

12:56

but there's another way of putting it. Now. One thing you

12:58

and I could be getting wrong here is if we're

13:00

talking properly about self delusion

13:03

or some other type of of bias

13:05

or like misperception in the brain. Because

13:08

the authors here they're saying, okay, self

13:11

delusion specifically, maybe

13:13

self delusion implies that there's

13:15

there's a sort of transformation going

13:18

on somewhere in the brain, Like the brain gets

13:20

accurate information about the world and

13:22

then just somehow presents it

13:24

to the conscious mind in a skewed way.

13:27

The authors share think that, especially if you're talking

13:29

about wishful thinking, is the brand of

13:31

self delusion, uh, you know, getting

13:34

false perceptions about the world in order to feel

13:36

better. They think that doesn't really work from a

13:38

like unconscious mind to conscious mind model,

13:41

because emotions and moods also seem

13:43

to emerge from the unconscious mind, not from

13:46

the conscious mind. But then there's

13:48

another thing they go to, which is that they

13:50

argue the empirical evidence for true

13:52

self deception in overestimation

13:55

it's actually kind of weak and kind of mixed.

13:58

Why would this be Well, first of all,

14:00

they say, it's hard to separate true self

14:02

deception from attempts to deceive

14:04

others, including the researchers. So

14:07

how can you tell when

14:09

somebody truly overestimates

14:11

their own traits or abilities versus

14:14

they just tell you that they

14:16

think their traits or abilities are

14:18

better than they are. In a lot of cases, both

14:20

would manifest equally as outward

14:22

over confidence. Now, you can

14:24

come up with some methodologies and some tests

14:27

to try to get around this, Like you can make people

14:30

bet sums of money that would

14:32

where the outcome of the bet would be dependent

14:34

on how good they actually are at a task

14:36

or something. But in a lot of cases,

14:39

they say, it's hard to tell the difference between true

14:41

self deception and

14:43

just attempts to deceive other people. Another

14:46

thing they point out is that you don't actually have to

14:48

be deceiving yourself to

14:51

overestimate your abilities. You

14:53

could be genuinely completely

14:55

ignorant of the fact that you're not as

14:57

good as you think you are. Uh. And

14:59

here's in place that the famous Dunning

15:01

Krueger effect comes in. Now,

15:04

you may have heard about the Dunning Krueger effect,

15:06

but very short sketch on it.

15:09

Of course, overlaps with a lot of what we're talking about

15:11

today. Participants less

15:13

skilled in a task or subject area

15:16

can be prone to show even greater

15:18

overestimation of their abilities in

15:20

that skill or subject area. So

15:23

with some skills, the worst you are,

15:25

the more you overestimate your awesomeness.

15:28

Now, why why on earth would this be? Well,

15:30

the authors here mentioned this could just simply

15:33

come from your low skills providing

15:35

you with a poor frame of reference.

15:38

You don't know enough about this

15:40

task or skill or subject area to

15:42

even understand how much you don't

15:45

know, so like the Dunning Krueger effect

15:47

would show not self deception but

15:50

genuine ignorance. You lack enough

15:52

information to understand how

15:54

bad you're failing. Like I think a

15:56

good example of this is you know, you read you

15:59

you read one theory about some phenomena

16:02

and uh, and it can be rather convincing.

16:05

It can be so convincing that you think, well, this is

16:07

it. They made a great case. But

16:09

if you don't, if if you don't actually look at some

16:11

of the other theories out there or look

16:13

at uh, you know, some sort

16:15

of if you look at writings or or or

16:17

pieces that actually compare them, or do some

16:19

sort of meta analysis, then you don't

16:22

really have a proper frame of reference

16:24

or even like sort of I wouldn't even say like nothing

16:26

like a perfect frame of reference, but even say like a healthy

16:28

frame of reference. Yes, you can go so like

16:30

you read one article about a subject

16:33

and then you're an expert, and then you start

16:35

reading more and you realize like,

16:37

oh wait a minute, you know there's so much

16:39

I don't understand that your estimation of

16:41

your own expertise drops sharply after

16:43

Yeah, you like you might realize, oh, well, there are

16:45

other theories, or you might realize, oh, well, this was

16:48

just one person's summary of

16:50

this particular theory, and oh and

16:52

then on top of that, perhaps they had a particular

16:54

acts to grind in writing it, etcetera.

16:56

Yeah, that's a great example. I mean not to say

16:58

that you should doubt every you read, but I

17:01

mean, yeah, you should have. You should you should

17:03

have healthy doubt, not you know, not denial

17:05

ism, but but you know, just be

17:08

aware that you don't know everything, and

17:10

you should be especially suspicious when

17:12

you have dipped your toes

17:14

into a subject and now feel that you

17:16

fully understand it. And we say

17:19

that as a professional toe dippers. Uh.

17:22

Now, finally, they point out that the empirical

17:25

evidence for wishful thinking itself

17:27

in general as a psychological phenomenon. They

17:29

say, this is not actually strong. Uh.

17:32

If if there were strong evidence for wishful

17:34

thinking, wouldn't it be the case that more

17:37

desirable outcomes would be more

17:39

strongly believed? And they

17:41

say, no, studies that try to test

17:44

this out do not find this to be the case.

17:46

It's not the case that the more you want

17:48

something, the more you believe it to be true. And

17:51

there are only a few types of scenarios

17:53

where there's any evidence of this at all, such

17:55

as scenarios where all outcomes are

17:58

equally likely, like a dice roll

18:00

or something. Now that is interesting to think

18:02

of in terms of dungeons and dragons,

18:04

were frequently one is either making an attack

18:07

or doing some sort of attempting, some sort

18:09

of act that requires a skill check. And

18:12

I find myself doing this. You'll you

18:14

go up there and you begin to explain what your

18:16

character is going to do, as if you hit

18:19

that natural twenty that's kind of the Yeah,

18:22

So I find myself engaging in a lot of that

18:24

level of overconfidence with my character

18:26

because ultimately it all comes down to the roll

18:29

of the dice. You know, unless I'm trying

18:31

to you know, leap off

18:33

of the democ organ's head or something, that is going

18:35

to be extremely difficult

18:37

because they're going to be additional numerical

18:40

you know values, uh, you know, addages

18:42

attracted from the attempt. You know, ultimately

18:44

it's still gonna be one to twenty one being

18:46

uh, you know, a pretty much complete

18:49

fail. Uh. You know that's gonna be the one where

18:51

you slip and stab yourself with your own

18:53

sword, or it's gonna be that natural twenty,

18:55

which is going to be you know, the wonder

18:57

hit where you do extra damage. That is

19:00

fantastic example. I I was

19:02

trying to think of cases where

19:04

I thought I really did engage

19:06

in wishful thinking, and I couldn't think. I'm sure

19:08

I do sometimes. But yeah, they

19:10

say it's not actually as common as people think it

19:12

is. And here's maybe one case. Yeah, I think in

19:14

Dungeons and Dragons, I have yet to meet

19:16

a player or be a player that

19:19

does not engage in will wishfull thinking.

19:21

Every time you roll the dice, like nobody nobody

19:23

rolls that dice and it says, all right, this is how I'm

19:25

going to fall off this table or

19:28

this is how I'm going to fall

19:30

into the next trap, and uh, and you

19:32

know, and skewer myself on a stake. No,

19:35

we want the best outcome and we we have it in our

19:37

mind before the dice puts

19:40

us in our place. Now, another thing

19:42

that the authors here bring up is that overestimation

19:45

itself. Remember again, that's just thinking

19:47

that you are better than you are in some way

19:49

in terms of abilities or traits or something.

19:52

Um that this actually has a mixed

19:54

evidential record. It's not always the

19:57

case that we overestimate ourselves on

19:59

all quality, easier tasks. It's

20:01

more the case for some things in particular,

20:03

And they give a couple of examples of things

20:05

where there really is a ton of evidence

20:07

for consistent overestimation. One

20:10

is something you brought up in the last episode, Robert,

20:12

the planning fallacy. There

20:15

is really good evidence that people consistently

20:17

overestimate how fast

20:20

they'll be able to get things done or

20:22

complete a project of some kind. And

20:24

this is especially true if

20:26

the project is difficult and novel.

20:29

So like, if I try to, you know, I put together

20:31

some complex thing for you to do that's

20:34

hard and you've never done it before, you

20:36

are really likely to massively

20:38

underestimate how much time it's going to take

20:40

you. Right if you're like, well, you know, I'm not a handyman,

20:42

but I think I'm gonna install this sink myself,

20:46

and then you watch a weekend just vanish.

20:49

Yeah, I know that feeling. Another

20:51

one that they cite is the illusion of control.

20:54

People pretty consistently overestimate

20:56

how much control they were they will

20:59

have over future. It comes even

21:01

things that that they should understand are basically

21:03

random. Right, you see this financially

21:07

in business wise. A lot of times where

21:09

someone will have they think they

21:11

have a clear idea of like how things are going to flow,

21:13

but they're they're just not taking into

21:15

account all the factors they cannot

21:18

control, and say the economy

21:20

or you know, or or or just

21:22

the industry that they're a part of. But

21:25

they're kind of they're acting, they're making choices

21:27

based on sort of like a not even a best

21:30

case scenario, but sort of like a standard

21:32

scenario. You know, Yeah,

21:34

I think I know what you mean. Like they're they're not counting

21:36

on the storm, and they're also not counting on the

21:38

wind to completely die away, and

21:40

that's how they're basing, you know, their their estimate

21:43

of how long it's going to take to sail across the sea.

21:46

Oh yeah, I mean that that's another thing, like we there's

21:49

actually a name for this. I've forgotten it at the moment.

21:51

Maybe I'll call it to mind in a second. But it's

21:54

the the assumption that the future will

21:56

be like the present. Yeah, maybe it's called

21:58

the continuation fallaci ores thing um.

22:01

But now there's one more thing that they bring up

22:03

with respect to overestimation, specifically,

22:06

uh and This is a standard

22:08

finding that applies to a lot of the research

22:10

on overestimation. It's called the hard

22:13

easy distinction or the hard

22:15

easy effect. And uh

22:17

that this one is interesting because we'll see some variations

22:20

with it in other types of overconfidence. But it

22:22

goes like this, we are more

22:24

likely to overestimate our abilities

22:26

on hard tasks and underestimate

22:29

our abilities on easy ones. So

22:32

again, like the hard project comes

22:34

up with the planning fallacy, you

22:37

massively underestimate how much time

22:39

it's going to take you to do that hard, complex,

22:41

novel thing, but then you might overestimate

22:44

how much time it's going to take you to do something

22:46

that's a common easy task. I

22:49

guess that the main example that's coming to mind on this

22:51

one would be the scenario where

22:53

driving across town, are going to a

22:56

particular destination takes less time than

22:58

you think it will, and then you show up like fifteen

23:00

minutes early or were worse. Yeah,

23:03

and the authors here have some explanations

23:05

for how exactly this is working that we'll get

23:07

to in a bit. Should we take a break, Yes, we should,

23:09

and when we come back we will continue our journey through over

23:11

confidence. Thank

23:16

alright, we're back all right, So we've been talking

23:18

about this paper about over confidence,

23:20

about the three types of overconfidence

23:22

by shots and more. We were just talking about

23:24

overestimation, the belief that you're better

23:26

than you are, especially with respect to some

23:28

kind of objective measure or independent

23:31

measure. And so we want to move on to

23:33

the next type of overconfidence they talk about,

23:35

which is overplacement. And again

23:37

this is different from overestimation because

23:39

this is thinking that you're better

23:41

than you are with respect to other

23:44

people and judging yourself compared

23:46

to others. Now, the authors have some

23:48

methodological critiques of some of

23:50

the literature here, but they acknowledge there's a lot of

23:52

evidence for overplacement, citing

23:54

the better than average effect in all its beastly

23:56

forms, like in the other paper that

23:59

we talked about that was, you know, recently found

24:01

to be extremely robust. Uh.

24:03

They've got some quibbles about methodology

24:05

and some of these studies, like using ambiguous

24:08

scales or measures. Robert, you were talking

24:10

I think in the last episode about you know

24:12

how some of these types of things like uh,

24:14

you know, how people rate themselves in

24:16

terms of attractiveness or

24:18

intelligence or something. These can of

24:21

course suffer from ambiguous criteria,

24:23

right yeah, or sometimes just straight up unfair criteria,

24:25

racist criteria, UM, misogynistic

24:28

criteria, etcetera. Well, yeah, it absolutely

24:31

has all those negative effects. I mean,

24:33

I think overplacement is like it's

24:35

behind a lot of the worst types of prejudices that make

24:37

themselves known. But even

24:39

if you're just like looking at what is the quality

24:42

you're trying to measure, you know, attractiveness

24:45

or something like that, that there's usually

24:47

not like a way of rating that is,

24:49

it's all based on these kind of ambiguous subjective

24:52

judgments. One great example of

24:54

this is something that we've brought up several times

24:56

already, like the

24:58

driving example. So Svinson in

25:01

one did a study where he discovered

25:03

that nine percent of American

25:06

drivers rated themselves above

25:08

the median and driving ability.

25:10

Obviously, whatever criterion you

25:12

use, it's impossible for to

25:15

be above the media, and it would have to be you know, like,

25:19

um, the majority can be above average,

25:21

but the majority cannot be above the median.

25:24

And the authors point out this would be more impressive

25:26

if it were more specific, because due

25:28

to this problem with like ambiguous scales

25:30

or measures, anybody could technically

25:33

have their own definition of what makes

25:35

a good driver, So you could be

25:37

answering that, thinking like, well, there are things

25:39

that I do well when I drive, and

25:42

maybe they're different from what somebody else

25:44

thinks that they do well when they drive, and that's

25:46

their criterion, right, I mean, your

25:48

your definition of being a good driver could

25:50

just be I did not you know, I wasn't in

25:52

a wreck on the way to work this morning, you know, Or

25:55

or it could be I get the places I need

25:57

to go fast like in

25:59

those those are definitely, you

26:01

know, not necessarily the same vision of

26:03

good driving. Or I look really cool

26:06

when I do it, you know. Uh.

26:08

There's another thing they bring up which is interesting, which

26:11

is the role of self selection

26:14

in increasing the apparent prevalence

26:16

of over confidence in the real world. So

26:18

an example would be like this, On average,

26:21

more overconfident people are

26:23

likely to apply for jobs just sort

26:25

of by definition, right, more

26:27

overconfident people are likely to start businesses,

26:30

to run for office, So we're

26:33

we're exposed to more of

26:35

these people, and this could lead

26:37

to us thinking that their confidence

26:39

level is more represented in the general

26:42

population than it actually is. Oh

26:44

yeah, you turn on the television. It's what it's

26:46

almost exclusively overly confident

26:48

people, that's true. Yeah, So if you just look

26:50

at like business leadership, politics,

26:53

celebrities, all this,

26:55

you're gonna see. I think you will see in general

26:57

way more over confidence than just

27:00

will talking to your friends and relatives

27:02

and co workers. Now here's a really

27:04

interesting thing. Remember we talked about the hard

27:06

easy effect or the easy heart effect

27:09

with overestimation, where people tend

27:11

to overestimate their

27:13

abilities on hard jobs

27:15

and underestimate their abilities on easy

27:18

jobs. Apparently, for overplacement,

27:21

it's there's also an easy heart effect,

27:23

but it's in the exact opposite

27:26

direction. With overplacement,

27:28

you overplace yourselves relative.

27:30

We overplace ourselves relative to others

27:33

on easy, common tasks

27:35

and underplace ourselves relative to

27:37

others on difficult, unusual,

27:39

or rare ones. So again, what

27:41

would be some examples of this? Uh,

27:43

you think you're in the ninety percentile

27:45

of drivers, but really you're in the forty.

27:48

This is an easy common task. On

27:50

the other hand, people think that they are

27:52

less likely than others to win difficult

27:55

competitions. Uh. Studies

27:57

show that when there's a teacher that decides

27:59

to make an exam harder and

28:01

graded on a curve, students expect

28:04

their grades to be worse than others,

28:06

even when there's common knowledge that there will

28:08

be a curve. So as the test gets harder, students

28:11

perceived that they will do worse relative

28:14

to other classmates. That's kind of interesting.

28:16

Uh. They point out that people believe they are worse

28:19

jugglers than other people. They

28:21

believe that they are less likely to win

28:23

the lottery than other people. Again a difficult,

28:26

rare thing, uh, And that

28:28

they here's here's a very interesting

28:31

version. Just in terms of ages. People

28:33

believe they are less likely than other

28:35

people to live past one hundred,

28:37

but they also think they're more likely

28:40

than other people to live past seventy.

28:43

Interesting. Well, of course, both of those kind

28:45

of depends on where you are in the age spectrum

28:47

when you're making that estimation, you know, because

28:49

you could be I mean, I mean, but

28:51

apparently it's true of all age, but

28:54

also your quality of life, right, I mean, for some

28:56

people that prospect of living two hundred,

28:58

Depending on where you are health wise, that

29:01

might be terrifying. That might be it

29:03

might be wishful thinking that you'll expire

29:05

sooner than that, uh, or it could

29:07

be the other way around, you know. Um,

29:10

what kind of explanations are they They

29:12

throwing out, Yeah, this was interesting, So yeah,

29:14

why do we fail in opposite directions here?

29:16

Depending on whether we're imagining our performance

29:18

against objective measures versus relative

29:20

to others, and the author's site solutions

29:23

from some of Moore's previously previous

29:25

work with other authors, they write

29:27

this quote. If people make any errors

29:30

estimating how well they've done or will

29:32

do, then it stands to reason they're

29:34

more likely to overestimate a low

29:36

score and the more likely to underestimate

29:39

a high score. That's the herd easy

29:41

effect. As long as people have more

29:44

uncertainty about others scores, they'll

29:46

tend to make even more regressive estimates

29:49

of others than of self. The consequence

29:51

would be that they overestimate others

29:54

even more than themselves on difficult

29:56

tasks and come to believe that they are

29:58

worse than others. The oppos that would

30:00

hold true for easy tasks. People would underestimate

30:03

others more than themselves and wind

30:05

up believing that they are better than others.

30:07

So that took me a minute to get my

30:09

head around, but then I finally made sense of it. So

30:12

when you're not sure how you will do it,

30:14

something, as we're always you know, not sure

30:16

there's a ton of uncertainty in life, or

30:19

you're not sure how others will do. They're

30:21

simply more room for possibility

30:23

to guess high if your performance

30:26

is likely to be low, and more room

30:28

to guess low if your performance is

30:30

likely to be high. And this applies

30:32

to both the self and other people.

30:35

Since we know even less about other

30:37

people than we do about ourselves, we're

30:39

going to spend more time guessing wrong

30:41

in these vast over and under zones

30:44

for other people, depending on what type

30:46

of task it is. Now we're going to talk

30:48

about over precision from this two

30:50

thousand seventeen study. Now, over precision

30:52

again is that that's like having way more

30:55

confidence than you should about what

30:57

you believe to be true. So I could ask

30:59

you, you know, I could ask you to answer a question, Then

31:01

I could ask you how confident you are

31:03

that your answer is correct? Uh.

31:06

And the authors here right quote results

31:09

routinely find that hit rates inside

31:12

confidence intervals are below fifty

31:14

percent, implying that people set their

31:16

ranges too precisely, acting as

31:18

if they're inappropriately confident that

31:20

their beliefs are accurate. So, if you take

31:22

a quiz, you say you're more than confident

31:26

on average about your answers, and you're actually

31:28

more like fifty percent correct on average.

31:31

This is something that's been found a bunch of times.

31:33

It's quite clear that there's tons

31:36

of over precision in human behavior.

31:38

The authors have a few critiques about like common

31:41

research paradigms that that are used to

31:43

study this. One example is they say, you

31:45

know it. It may be that normal people don't have

31:47

a very solid understanding of how to use confidence

31:50

intervals, so there have been other ways of trying

31:52

to measure it. But however,

31:54

the authors here believe that over precision

31:56

is the most pervasive form of

31:58

over confidence. You find it absolutely

32:01

every everywhere, even in experts

32:03

talking about their own subject matter. I

32:05

think that's come up on the show before that, I don't remember

32:08

when. After this, the authors here turned

32:10

to the question UH, a question we talked

32:12

about a little before. Could over confidence

32:14

actually be useful? Like? How

32:16

do why does it make sense for a brain to be

32:18

overconfident? Uh? And they talk

32:20

about explanations in two main categories,

32:23

intra personal and interpersonal

32:26

UH. The authors generally think the evidence

32:28

for the interpersonal explanations

32:31

the the explanations and how it works on other

32:33

people are stronger than the intra

32:35

personal ones, though there kid could be

32:37

some good intra personal ones. For example,

32:40

you know, maybe over confidence doesn't just make you

32:42

feel good, it, as we hypothesized

32:44

earlier, makes you more likely to take

32:47

risks that can pay off big. Yeah.

32:50

Well, I mean, for instance, to come to to go to like

32:52

a predator prey scenario like

32:54

one is reminded of the

32:58

you know, how effective your average editor

33:00

is. You know they're going to fail a

33:02

lot. And granted, a

33:05

leopard is not really subject to human

33:08

uh, you know, over confidence or under

33:10

confidence, but certainly if you

33:12

if you if you look at a human scenario, if

33:14

you look at human hunters, uh, you know it,

33:17

it's certainly a situation where it would pay to

33:19

be overconfident, uh, to

33:21

a certain degree. Yeah, I think you can

33:23

find some analogies of confidence and over

33:25

confidence and animals like you know, how likely

33:28

are you to try to take down prey

33:30

animal that you're very unlikely to succeed

33:33

against, but you know, would provide you with a lot

33:35

of meat and energy if you do right. Though,

33:37

of course, the reverse of the other side of that is

33:39

that you would not need want to be so overconfident

33:41

that you were going after prey that was extremely

33:44

likely to kill you if you try to bring

33:46

it down right. But the authors

33:48

here they do think that there's really good evidence

33:50

for interpersonal benefits for over confidence.

33:53

One example would be all the empirical evidence

33:56

that already exists that just outwardly projecting

33:58

confidence has all these benefit fits affecting

34:00

how other people see us. There are studies

34:03

that show that highly confident people are

34:05

more persuasive, they're more influential,

34:07

they're perceived as more sexually attractive,

34:09

they tend to get promoted to positions of authority

34:12

in groups. Um, And it's

34:14

possible that confidence is actually more

34:16

important than competence in determining

34:19

who gets promoted to high status

34:21

positions the author's right quote.

34:23

While a preference for confident leaders may

34:25

make sense if there's a correlation, however,

34:27

weak, between confidence and competence,

34:30

there is real risk in selecting over confident

34:32

leaders. Well, I mean, because on

34:35

one hand, you you want a boss that can

34:37

say, you know, do their job and and keep

34:39

the company afloat and actually grow

34:41

the business, etcetera, all the various catchphrases.

34:44

But you also want a boss that you can kind of like

34:47

you can. You can you can trust that they're doing their

34:49

thing like they seem confident. I

34:52

guess they have their whole end of it figured out, and

34:54

maybe I can focus on my own thing and

34:56

not my own role in the company without you

34:59

freaking out a what's going to happen tomorrow?

35:01

Well, maybe in the business scenario

35:03

we should pivot to talking about the Icarus

35:05

paradox. Oh, all right, we're gonna

35:08

take a quick break, but we'll be right back with more than

35:11

thank and we're

35:13

back. So, Robert, you wanted to bring

35:15

in a concept from the business world about overconfidence,

35:18

the Icarus paradox. Yeah, And I'm

35:21

as surprised as maybe some of you are that I'm bringing

35:23

in a something business wise, but

35:25

it caught my attention when I was looking for things on

35:28

for papers and so forth, on over confidence,

35:30

and also looking at Greek mythology

35:32

and so forth, because yeah, the Acarus paradox

35:35

invokes the story of Charask rather directly.

35:38

And I think it also makes sense at another level, because

35:40

you know, we don't have gods so much

35:42

anymore, Like these are not the driving

35:45

commanding forces in our

35:47

world, but we do have institutions,

35:49

industries, global economies. And

35:52

these are not unlike the concepts of the gods,

35:54

right. You know, they're sometimes lawful, sometimes

35:56

chaotic entities that are likely to

35:58

destroy you if you question their authority,

36:01

or if you you you turn against

36:03

them. But anyway, I ran across this

36:05

interesting concept of the acress paradox

36:08

um. It was devised by Canadian

36:10

economist Danny Miller, and

36:12

he points out that businesses are often

36:14

like Icarus in the myth. They

36:17

start out confident and competent, they rise,

36:20

but then they perish.

36:22

Uh. The The irony, he writes, is that

36:24

many of the most dramatically successful

36:26

companies are prone to this exact

36:28

sort of failure. Uh. And

36:30

and it doesn't necessary in the business sense, since

36:33

businesses are sometimes

36:35

less likely to die. They're more like the gods. You know,

36:37

they're they have downfalls, but there may be

36:40

they may very well be immortal in some cases.

36:43

Right, they're still alive. They're just chained to a rock getting

36:45

their liver pecked out by an eagle, right for

36:48

eternity. You know, maybe they just declare

36:50

multiple bankruptcies. Immortal declares

36:52

bankruptcy. It's a different thing than than a corporation

36:54

doing it. Um. Wait, what is that

36:56

eagle? It's like a private equity

36:58

eagle. Yeah, the private ECU eagle. Um.

37:01

And yeah, he mentioned several companies and discussing this, and

37:03

and most of them I think that he was discussing are still

37:06

around like they have survived their downfalls.

37:08

Uh. But yeah, yeah. He writes that

37:10

the irony is that that many of these

37:13

dramatically successful companies are prone to these

37:15

sort of failures. And what's more, the very factors

37:17

that drive success, when taken to

37:19

excess, are the factors that bring about

37:21

decline. So I

37:24

think this is an interesting model to look at, not only

37:26

for the you know, because it's a just to take on it

37:28

from the business world, but I think he can also serve as

37:30

sort of a reflecting pool for some of the

37:32

individual concepts that we've discussed

37:34

already by placing them out outside

37:36

of the human psyche and looking at them in the context

37:39

of an organization or a culture. So

37:42

Miller wrote a book about

37:44

this, The Icarous Paradox, How Exceptional

37:47

Companies bring about their own downfall. New

37:49

Lessons in the Dynamics of Corporate

37:51

success, Decline, and Renewal. I know you love

37:53

a long title like that. Um.

37:56

But I also I was mainly looking at

37:58

his Business Horizons

38:01

article that he wrote on the subject,

38:03

and he summarizes a lot of the key points.

38:06

So Miller identified four key

38:08

to trajectories in the

38:11

riches to rags business

38:13

scenario. So the first

38:15

one that he mentions is the focusing trajectory.

38:18

In this trajectory, the craftsman

38:20

becomes the tinker quote firms

38:23

whose insular, technocratic monocultures

38:26

alienate customers with perfect

38:28

but irrelevant offerings.

38:30

So I guess in a scenario would be, you

38:32

know, the company that creates a really

38:34

groundbreaking product, and then

38:36

all they do is tinker

38:38

with that concept. All they do is

38:40

make adjustment to that concept, and

38:43

eventually, like somebody else is going to create

38:45

a better widget or a better you

38:47

know, smartphone, or whatever the situation

38:49

may be, somebody else is going to take some

38:52

some you know, some wider swings. Next

38:55

comes the venturing trajectory, and this

38:57

is by which builders become imperial

39:00

list And this one, I think is the one that really

39:02

has the smack of overconfidence to it.

39:05

In this trajectory, the strategy

39:07

of building feeds into over expansion.

39:10

The goal of growth becomes grandeur

39:13

and an entrepreneurial culture becomes

39:15

one of the gamesman, A

39:17

divisionalized structure becomes

39:19

fractured. And then on top

39:22

of that there's the the inventing trajectory.

39:24

This is where you go from pioneering to escapist.

39:27

In this trajectory, innovation feeds into high

39:29

tech escapism. Science for society

39:31

transforms into technological utopianism.

39:34

Research and development gives way to think tank

39:37

culture, and the overall culture goes from

39:39

organic to chaotic. And

39:41

then he rounds us out with the decoupling

39:43

trajectory from salesman to

39:45

drifter quote. Finally,

39:47

the decoupling trajectory transforms salesman

39:50

organizations with unparalleled marketing

39:52

skills, prominent brand names, and broad

39:55

markets into aimless, bureaucratic

39:57

drifters whose sales fetish obscure

40:00

is design issues and who produce a stale

40:02

and disjointed line of me to offerings.

40:05

Okay, so that's the company that's more based

40:07

around marketing culture than around having

40:09

a good product, right. You know. Thinking about these

40:11

trajectories kind of reminds me of the

40:13

peaking in high school stereotype.

40:15

In life trajectories, it's a stereotype,

40:18

but there is some truth to it. I think it's possible

40:20

that too much success early on in

40:22

life can kind of corrupt a person

40:24

and can kind of corrupt your work ethic, your ability

40:26

to learn from mistakes and mature. It's

40:29

important for people to experience both successes

40:31

and failures early in life. Yeah,

40:34

yeah, I think so. It kind of comes

40:36

back to what we talked about looking at considering

40:38

Aristotle's uh summary

40:40

of hubrists saying that the the young and the

40:42

rich were the most likely to engage in it,

40:45

and the idea that perhaps in some scenarios,

40:47

certainly there there are plenty of

40:49

examples of very wealthy people who got there

40:52

through defeat, like through learning the lessons

40:54

of defeat. There are also examples of

40:56

of people who have you know, arguably

40:59

maybe you know, never suffered a true

41:01

defeat like they have. They have remains

41:03

sort of man children, uh kind

41:05

of failed upward. Yeah, that sort of thing. Um.

41:08

And again we're dealing abroad tropes here. But

41:10

you know, to some extent, I think it's useful

41:12

to consider, uh, to consider these

41:15

um. But but also I

41:17

feel like it it does get too into the idea

41:19

that that when we're

41:21

dealing with the trajectory of of a human

41:24

life, you know. Um. Part

41:27

of it is perhaps comes down to just our ability

41:29

to forecast the future, our ability to make

41:32

long to engage in long term planning. Like

41:34

we're as humans were generally not

41:36

as good about that. We're certainly not good about planning

41:39

beyond uh, you know, the scope of a human

41:41

life. But but even like beyond the scope

41:44

of a of a few years, we're better at the short

41:46

term goals, and it's only with considerable

41:49

effort that we we get better

41:51

at considering long term goals. Um.

41:54

So I think that's important to keep in mind. And all of this

41:57

now, one thing that I think is also interesting in Miller's

41:59

writings is that he talked he he talks

42:02

a bit about over confidence, you know, as

42:04

a symptom of underlying issues,

42:06

you know, as opposed to being like

42:08

an intrinsic quality. Uh.

42:11

He writes, Unfortunately, configuration

42:13

and synergy are usually attained at

42:15

the cost of myopia. Stellar

42:18

performers view the world through narrowing telescopes.

42:21

One point of view takes over, one

42:23

set of assumptions comes to dominate.

42:25

The result is complacency and over

42:28

confidence. And I think

42:30

that plays into a lot of what what we've we

42:32

spoke about earlier. You know. Sorry, I'm trying

42:34

to make sense of it. Given the discuss the word synergy

42:37

in it, I shouldn't know what that means. By now

42:39

I've purged it from my brain. Oh

42:41

okay, I see now, Yeah, I'm looking at the quote.

42:43

Okay, So no, this is this is a very

42:45

standard thing. Uh. You know, if you

42:48

have successfully hammered

42:50

several nails in everything and you've

42:52

still got the hammer, everything really starts

42:54

to look like a nail, just because

42:57

like, if you've had success with

42:59

the strategy and past, you don't

43:01

switch. You just keep doing what you've done

43:03

before, even if it doesn't make sense of that. Yeah,

43:05

this is the this is what works, this is what our

43:07

product is, and this is what we're going

43:09

to stick to. Um and

43:11

and then yeah, he talks a good bit about to do

43:14

about over confidence as just a result

43:16

of success, writing quote failure

43:18

teaches leaders valuable lessons, but good

43:20

results only reinforce their preconceptions

43:23

and tether them more firmly to their tried

43:25

and true recipes. Success

43:27

also makes managers overconfident, more

43:29

prone to excess and neglect, and

43:31

more given to shape strategies to reflect

43:33

their own preferences rather than those of the

43:36

customers. And uh, you

43:38

know. He also points to

43:40

one of the key aspects of the icorous paradox

43:42

being that overconfident, complacent

43:45

executives extend the very factors

43:47

that contributed to success to the

43:49

point where they cause decline. So

43:51

the thing that's working, you know, the

43:53

button we're pushing that is leading

43:56

to success, let's just really jam that sucker.

43:58

You're like the rat in the experien that keeps

44:00

pushing the cocaine button. Yeah. So

44:03

he summarizes that there are really two aspects

44:06

of the acreous paradox. One is the success

44:08

can lead to failure via the fostering of overconfidence

44:10

and other factors. And then to the aspects

44:13

of a business that brings success can also

44:15

hasten failure or quote, the very

44:17

causes of success, when extended, may

44:19

become the causes of failure. And

44:22

as far as you know, ways to

44:24

fight these transformations. Because that's when one

44:26

question I had, It's like, is this just the trajectory?

44:28

This is what happens? Like this is things

44:31

can't just go up forever and a

44:33

business cannot just exist, you

44:36

know, indefinitely, like things

44:38

have to die, right, I mean, these

44:40

corporations are not like you mortals,

44:43

but they are given to life

44:45

and death. They're not eternal. Uh

44:48

and and he says, he argues that there are ways

44:50

to fight these transformations. He

44:52

suggests self reflection and intelligence

44:54

gathering that guards against excess, over

44:56

confidence and irrelevance. And this,

44:59

this I think matches up with what we've been

45:01

talking about so far in the individual level, Like

45:04

like, if you think you're you're gracious, like take

45:06

a step back and and and uh

45:08

and and think in the question whether you know you

45:10

actually are to what extent you are? What else you

45:13

could be doing to ensure that that that you were

45:15

actually living up to your overestimation

45:17

of self. If you think it's true about yourself,

45:19

prove it, Prove it to you. Yeah, I have to say

45:21

Miller is a is a is

45:24

a really good writer about it this because normally I'm not

45:26

interested in business culture

45:28

type stuff like this, but but he does

45:30

a great job of like tying it back into just the

45:32

basic human scenario as well,

45:35

Like like he points out that excellence

45:37

in any human endeavor, be at arts or

45:39

sports or what have you, you know, it tends to

45:41

come at a price. We cannot excel at

45:44

everything. We have to make sacrifices

45:46

and choose what's important in the middle

45:48

of the road, or a jack of all trades approach

45:51

is not going to lead to greatness,

45:53

you know, unless it's a story or some fable

45:56

where greatness is just thrust

45:58

upon somebody. You know, Uh,

46:02

there's got to be some sort of trade

46:04

off there. And he says it goes for the individual,

46:06

but it also applies to companies as well. You

46:08

can only sharpen your blade if you

46:10

first realize that it is dull and must

46:13

be sharpened. You know, like if if you if

46:15

you believe yourself eternally and infinitely

46:17

sharp, you're not going to do the sharpening right.

46:20

And it's interesting to come back and think about the individual

46:22

level and think about over confidence in this scenario,

46:24

like one like basic trophy mentions

46:27

is the idea of say, you know, the artist

46:29

who neglects their family to focus

46:31

on their art, or a business person that does the same

46:33

thing. In those scenarios, might

46:36

it be you know, I

46:38

guess you know, maybe in a warped sensor in a way

46:40

that that that caters to their

46:43

their prime focus. Might it be beneficial

46:45

to just think, oh, I'm a good dad, I'm a good

46:47

husband, even when they're not. But

46:49

it enables them to then put all

46:51

of their more of their resources anyway into

46:54

the pursuit of the thing that ultimately matters

46:56

to them, like you know, card, hard cold cash,

46:59

or the pursuit of art. Yeah. Well,

47:01

so to be clear, obviously

47:03

this wouldn't mean that it's actually useful

47:06

in being a good person, have any good

47:08

life, but it may very well be useful

47:10

in focusing on whatever it is

47:13

that really matters to you, to be overconfident

47:15

about your your crappy efforts

47:18

in other areas of life. Yeah,

47:20

I think that's entirely true. So it's

47:22

it's Yeah, it's interesting to compare the two,

47:24

the corporate version of this in the individual

47:26

version of this. And certainly if you want to read more

47:28

about this idea of the acreous

47:30

paradox, I certainly recommend

47:33

checking out more of his writings. So we have all

47:35

these economic metaphors, like you know from

47:37

Adam Smith, the Invisible Hand and whatever,

47:39

I feel like we need an economic metaphor

47:42

of the nemesis, Like the Nemesis

47:44

that is this force in the market

47:46

that swoops into punish hubrist and over

47:48

confidence in business. Yeah,

47:51

sometimes it seems like Nemesis is a little a

47:55

little uh resistant to doing

47:58

that. I don't know, I mean, part of it comes down again to

48:00

the fact that that businesses and corporations

48:03

are are are less mortal.

48:05

Well, yeah, I mean it is funny that, uh,

48:08

we've discussed a lot of these episodes how overconfidence

48:10

can both lead to disaster and

48:13

and negative outcomes, but can also

48:15

in some cases be highly rewarded and

48:17

be very lucrative. Yeah.

48:20

Yeah, you know, I'm also remind talking

48:22

about, you know, curbing

48:25

overconfidence or the perception of overconfidence

48:27

by making statements that cannot be put

48:30

to the test. You of course see that a lot

48:32

in the business world. You know that

48:34

if you're saying you're the best car dealership

48:36

in the galaxy, you know that you

48:38

can get away with saying you're the best car dealership

48:41

in town. Well, then people can

48:43

say, well, let's see your sales numbers, let's compare you

48:45

to gems across town. No, even that would

48:47

be easier to get away with, Like the one that would be hard

48:49

to get away with is saying like we have the lowest

48:51

prices in town or something like that.

48:53

Then you're like, then you're stuck either

48:56

that's true or that's not right. But

48:58

then again, on a personal the first all level,

49:00

you know, you can have your mug that says world's

49:02

Greatest dad and nobody's

49:04

gonna call you on that. What you can get out your dad

49:06

ruler and measure me. Yeah,

49:09

all right, So I think we've we've reached

49:11

the end of our discussion here for the

49:14

week on overconfidence, but

49:16

clearly there's a there's a lot of material here. It'll

49:18

be interesting to hear back from listeners

49:20

because I think we all have some perspective on this. We

49:22

all have experience with with over

49:24

confidence in others or certainly

49:27

in over confidence in ourselves or the management

49:30

of overconfidence in ourselves, and so

49:32

we we'd love to hear everyone's thoughts on this. In

49:35

the meantime, if you want to check out other episodes of Stuff

49:37

to Blow your Mind, you can find them wherever

49:39

you find your podcasts. If you go to

49:41

stuff to Blow your Mind dot com, that will lead you

49:43

over to the I Heart listing for our

49:45

show, but you can find us

49:48

anywhere and wherever that happens to be. Just make

49:50

sure you rate, review, and subscribe

49:52

that really helps us out huge thanks

49:54

as always to our excellent audio producer Seth

49:57

Nicholas Johnson. If you would like to get in touch

49:59

with us with back on this episode or any other

50:01

to suggest topic for the future, just to say

50:03

hey, you can email us at contact

50:06

at stuff to Blow your Mind dot com.

50:15

Stuff to Blow Your Mind is a production of iHeart Radios.

50:17

How stuff Works. For more podcasts from my Heart

50:19

Radio is at the iHeart Radio app, Apple Podcasts,

50:22

or wherever you listen to your favorite shows.