The self-centred bias

The film critic Pauline Kael is reputed to have said after the 1972 election: "I don’t know how Richard Nixon could have won. I don’t know anybody who voted for him." The quote is apocryphal, but it captures a widespread error of judgement - our tendency to exaggerate the extent to which others agree with us. A new paper by Eugenio Proto and Daniel Sgroi shows just how common this tendency is.

They show that students at the University of Warwick tend to over-estimate the numbers of fellow students: who are as happy or sad as themselves; who share their political orientation; and who own the same brand of mobile phone as themselves. More remarkably, they over-estimate the numbers who are of similar height or weight to themselves, even though height and weight are easily observed: fat people over-estimate the number of lardies and tall ones the number of beanpoles. They say:

Self-centred perceptions are ubiquitous, in the sense that an individual’s beliefs about the rest of the population depend on his or her own position in that distribution. Those at the extremes tend to perceive themselves as closer to the middle of the distribution than is the case.

This self-centred bias, which is related to the false consensus effect, might have numerous effects:

 - It can contribute to an obesity epidemic. If fat people over-estimate what is a normal bodyweight, they are less likely to take the effort to lose weight.

 - It can lead to bad investment decisions. If we exaggerate the extent to which others value an asset as much as us, we'll be more likely to pay a lot for it - leading to the winner's curse and to price bubbles.

 - It can contribute to the middle England error - the tendency for politicians and journalists to over-estimate the numbers of people from posh backgrounds or with high incomes simply because they themselves are posh and rich. This can contribute to policies being biased towards the rich in the mistaken belief that they are "middle class."

 - If we exaggerate the extent to which others share our beliefs, we'll tend to have excessive confidence in those beliefs. We'll think: "if so many of us think the same way, we must be right.

 - We'll become less tolerant, because beliefs and behaviour which are different from ours will be seen as aberrant. This might have contributed to the closing of liberal minds of which Tim Lott complains.

 - It can contribute to behaviour which is later regretted. I suspect the MPs expenses "scandal" occurred because MPs thought tweaking expenses was normal and so under-estimated how bad it would look in public. Similarly, HSBC bosses might have thought collusion with tax-dodging was tolerable simply because their fellow bankers thought so - and forgot that the public thought differently.

For me, one implication of this is that we should go out of our way to seek out cognitive diversity - to remind ourselves that our ideas might be minority ones. This is why the creation of "safe spaces" in universities is to be regretted.

However, this bias isn't always a costly one. Quite the opposite. The entrepreneur who thinks "I reckon this is a good idea, so others will too" is more likely to give us new products and companies than the man with a clearer-minded view.

Cognitive biases aren't always bad things - which, given their ubiquity, is just as well.

Comments

[Donald]

"However, this bias isn't always a costly one. Quite the opposite. The entrepreneur who thinks "I reckon this is a good idea, so others will too" is more likely to give us new products and companies than the man with a clearer-minded view."

I'm not sure about this. He's also more likely to waste resources on a stupid idea. So, at some level over optimism of this type must be bad for society. It follows that there's an optimal level of consensus bias among entrepreneurs (and potential entrepreneurs).

Is your assumption that we're below that optimum?

[Luke]

Wasn't there some study of prisoners in which they rated themselves as more trustworthy than average? And in a rare moment of self-knowledge, merely averagely law-abiding.

[Luis Enrique]

Well, there are two mistakes you can make. One is thinking everybody else is like you, the other is thinking other people are different to you.

[Steven Clarke]

"For me, one implication of this is that we should go out of our way to seek out cognitive diversity - to remind ourselves that our ideas might be minority ones."

The converse is true. Our view may be the majority one, and it may be wrong. Seeking out a different, minority view may then be helpful in puncturing any group-think.

[Dain]

"Cognitive diversity" is something conservatives would like to see more of, while progressives are probably correcting in thinking this would undercut racial diversity. Which kind of diversity is more important? Presumably racial diversity is important BECAUSE it promotes cognitive diversity. But does it?