EffectEgocentric Bias · Entry 37
Overconfidence Effect – when you're sure, but still wrong
Do you say you’re 99% sure about something, only to find out you were wrong? That’s Overconfidence Effect – the tendency to overestimate the accuracy of your knowledge and decisions, even when mistakes are likely.
Where it can show up
- Quizzes and tests – you mark ‘absolutely sure,’ but mistakes happen more often than you think.
- Business – investors believe they ‘know’ the market, but their predictions fail more than expected.
- Everyday decisions – you’re confident about a memory, yet the details turn out to be incorrect.
A practical countermeasure
- Double-check yourself – if you feel completely certain, pause and review the facts.
- Accept the possibility of being wrong – even experts make mistakes, and so can you.
- Be cautious with predictions – confidence doesn’t equal accuracy, especially in complex matters.
