Neglect of Past Experiences in Prediction
People tend to neglect their past experiences when making predictions, often due to a focus on the future, difficulty extracting relevant instances, and attributions that diminish relevance, especially when past experiences contradict optimistic expectations.
THE IDEA
Obstacles to Using Past Experiences
Despite the predictive value of past experiences, our findings suggest that people neglect them while forming predictions. Why might this be so? One answer was suggested previously: prediction, by its very nature, elicits a focus on the future rather than the past, and this future orientation may prevent individuals from looking backward. However, a failure to use personal base rates need not always result from inattention to the past. People may sometimes attend to their past, but nevertheless fail to incorporate this information into their predictions because it doesn’t seem relevant. People may have difficulty extracting an appropriate set of past experiences; the various instances seem so different from each other that individuals cannot compare them meaningfully (Kahneman & Lovallo, 1993; Kahneman & Tversky, 1979). As a British rugbyplayer-turned-commentator noted, “Each game is unique, and this one is no different [than] any other.”
We suggest that people often make attributions that diminish the relevance of past experiences to their current task (Ross & Fletcher, 1985). People are probably most inclined to deny the significance of their personal history when they dislike its apparent implications (e.g., that a project will take longer than they hope). If they are reminded of a past episode that could challenge their optimistic plans, they may invoke attributions that render the experience uninformative for the present forecast. This analysis is consistent with evidence that individuals are inclined to explain away negative personal outcomes (for reviews, see Miller & Ross, 1975; Snyder & Higgins, 1988; Taylor & Brown, 1988). People’s use of others’ experiences (population base rates) is also limited by perceptual and attributional factors: A focus on the future reduces the salience of others’ experiences, and the tendency to attribute others’ outcomes to their own dispositions (Jones & Nisbett, 1972) limits the inferential value of others’ experiences. Furthermore, our understanding of other people’s experiences is typically associated with uncertainty about what actually happened; consequently, we can readily cast doubt on the generalizability of those experiences. To quote Douglas Adams, “Human beings, who are almost unique in having the ability to learn from the experience of others, are also remarkable for their apparent disinclination to do so.”
When to use it
Project management: Estimating timelines for software development or construction projects.
Personal goal setting: Predicting how long it will take to learn a new skill or achieve a health goal.
Healthcare: Patients predicting recovery times after surgery based on past experiences with similar procedures.
Using relevant historical investment outcomes to challenge an optimistic forecast while considering how present conditions differ.
FROM THEORY TO EVERYDAY LIFE
In practice
Project Planning Optimism
A team is estimating the time needed to complete a new software feature. Despite having historical data showing that similar features took an average of 2 weeks longer than initial estimates, the team forecasts a tight deadline based on their optimistic view. They attribute past delays to unique circumstances and believe this project is different, ignoring the personal base rate from their own experience.
Learning from Others' Mistakes
In a hypothetical example, an entrepreneur has data showing that most startups in her industry fail within the first year. She attributes those failures to others’ poor management or bad luck without checking whether the same risks apply to her business. The problem is dismissing relevant base rates, rather than choosing to start a business at all.
A MOMENT TO REFLECT
Put it to work.
Think of a time when you predicted the duration of a task. Did you consider your past experiences with similar tasks? Why or why not?
When you are planning a project, what steps can you take to ensure you incorporate relevant past experiences into your forecast?
Consider a situation where you dismissed a past failure as 'different' or 'unique'. Could that dismissal have biased your future predictions?
References
- Timid Choices and Bold Forecasts: A Cognitive Perspective on Risk Taking — Kahneman, D. & Lovallo, D. (1993)
- Prospect Theory: An Analysis of Decision under Risk — Kahneman, D. & Tversky, A. (1979)
- Attribution and Social Perception — Ross, M. & Fletcher, G. (1985)
- Self-serving biases in the attribution of causality: Fact or fiction? — Miller, D. T. & Ross, M. (1975)
- Excuse making: A view from the attributional perspective — Snyder, C. R. & Higgins, R. L. (1988)
- Illusion and well-being: A social psychological perspective on mental health — Taylor, S. E. & Brown, J. D. (1988)
- The actor and the observer: Divergent perceptions of the causes of behavior — Jones, E. E. & Nisbett, R. E. (1972)
CONTINUE THE CONVERSATION
Source texts
- Heuristics and Biases The Psychology of Intuitive Judgment (Thomas Gilovich, Dale Griffin, Daniel Kahneman)