Join Yash Patel for an in-depth discussion in this video Why we love predictions, part of The Psychology of Living In A Data-Driven World.
- So why are people so bad at making predictions? Daniel Gardner's book Future Babble may have some of the answers. One important takeaway to keep in mind. People like to think that they have actual control of the future, or that they know when things are due. For example, when they gamble, they like to roll dice harder for higher numbers, softer for lower. This ridiculous phenomenon is called the Illusion of Control, as if somehow they could influence the future by the strength of their throw.
You see this in sports all the time. Take a look at Andrew here. He is quite the superstitious man. Some people don't wash their socks between games or always put the left shoe on before the right. Andrew wears his rally hat. I wipe my right hand twice on my back right pocket before throwing a bowling ball, every single time. And people do these things, it gives them faith, it makes them believe, but that doesn't mean that it's logical, or that it makes any rational sense. And it's certainly not an indicator of how the future is going to pan out.
My average bowling score is below 100, I am terrible. I'm probably better off just not having a superstition. Another huge misconception with predictions is the idea of Inevitable Probability. For example, people keep pumping coins into the slot machine at casinos. They think that their chances of winning increases each time they lose. Nope, that's not right. The probability actually the same, independent of how many times the player's played. There's no jackpot that's due. There are supposedly strategies to circumnavigate this, like taking a look at the machine payout log, but I don't really know how realistic any of those are.
Extrapolation is another way people think they can predict the future, and this one's used fairly often, and it's one of the better ways. This tendency to take current trends and project them into the future is a starting point of most attempts of prediction. After all, tomorrow, typically, is like today. Current trends do tend to continue, but not always. Change happens, and the further we look into the future, the more opportunity there is for current trends to be modified, bent, or reversed.
So what's the moral of the story? Be careful with what you think you can predict. In fact, I'll predict that your prediction will likely be wrong.