Join Yash Patel for an in-depth discussion in this video The emotional connection to predictions, part of The Psychology of Living In A Data-Driven World.
- [Instructor] Election time, polls, polls, polls, polls, polls. You get it. They're essentially just predictions of which candidate is going to win. Maybe you pay attention to this stuff, but do you know much about how the data is collected? I'll tell you this, a lot of the analysis is based on inadequate sample sizes, which means that prediction polls really don't mean much of anything. When you watch election coverage on TV I bet you say to yourself, "Oh man, I cannot believe that candidate Y is winning," but are they actually winning in reality? No, it's just a prediction based on who knows what kind of methodology.
The news team doesn't really want to bore you with the technical information that actually matters on the backend. They want you to feel emotion so that you're hooked and you keep watching. What about the stock market? Analysts pour over data to predict how the market is going to behave, but the reality is that future models of the stock market, and economic behavior in general, are unreliable. Economic events may span several years and the world is changing over the same time frame. So the majority of past observations are invalid and irrelevant.
Here's the bottom line. You can't always use the past to predict the future. Whether it's polls, the stock market, or anything else. In fact, you can't really use much of anything. Why? 'Cause you're not a daggone fortune teller. One more example, and this is my all time favorite, fantasy sports. My goodness, your ability to predict which players are going to secure X or Y amount of points is so low it doesn't even belong on a numerical scale. However, week after week you go in, you do your research, you set your lineup, you check the waiver wire, why? 'Cause it's fun.
You have an addiction to it. There is such a high emotional appeal. You want to be better, smarter, more analytical than your opponent. Yep, no worries. I am a total culprit as well. It's incredible how well your heart felt emotions work with your analytical brain. Anyway, you get my point. There is this huge obsession with predictions. To me, that is really strange and why do I feel that way? Let's explore that next.