Magazine article Journal of Property Management

Expertise and the Illusion of Knowledge

Magazine article Journal of Property Management

Expertise and the Illusion of Knowledge

Article excerpt

If given a choice, most people would rather be an expert than a novice. We listen to experts with rapture; after all, they are so confident in their beliefs. But what about experts' accuracy in decisions and forecasts?

THE BRAIN'S BIAS:

Not having the benefits of computer processes, the brain has its own perception of reality, including biases, the fog of memory, fears, wishful thinking and more-they all weigh in to lessen accuracy, as does expertise. Wait...expertise lessens accuracy? It certainly can. The brain would rather pretend it knows something than admit it doesn't. It feels good to "know," but it creates a sense of false security and confidence in decisions. And it has a name: The Overconfidence Effect. When a person's belief in his or her own knowledge, judgment and decisions is higher than their accuracy, the result is an unrealistic perception-and it's due to self-confidence.

Unwarranted beliefs in decisions and predictions are a form of illusion. Miscalibration is the variance between how accurate predictions are and how accurate a person making them thinks they are. The more accurate you think you are, the more apt you are to act and, even if things point to a different direction, to dig your heels in and stay with your original thought, often to your detriment.

THE DANGER IN OVERCONFIDENCE

Confidence is mostly considered to be a positive attribute and many things seem impossible without it. Developing real estate, starting a business, even applying for a new job may seem insurmountable without confidence. …

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