There has been a lot of previous research on how risky choices differ depending on whether information (e.g., the performance of a worker) is learned about by “experience” (e.g., a front-line manager observing daily performance) or learned about from “description (e.g., a top-level manager reading a summary of performance over a long period of time). In this research, Ben Newell and I wanted to investigate how this description/experience distinction extended to over-confidence.
The form of overconfidence that we examined in this research is “over-precision”, which is the tendency for individuals to believe that their predictions are much more accurate than they really are. But when are people more over-precise: After learning from a description or from experience?
Well, you can read the research paper here (or here for 50 days free access). The takehome message is that those learning from description tended to be over-precise whereas those learning from experience were under-precise.
Implication? It is probably a good idea to pay more attention to the person in the room who has learned from experience.
I want to thank the reviewers of this paper – they were extremely helpful and fair. I also applaud the editor for encouraging us to pre-register our final experiment. I think this is a good practice for improving research across the board.