Harboring a mistakenly inflated belief that we can easily meet challenges or win conflicts is actually good for us, a new study suggests.
Researchers say they have shown that overconfidence actually beats accurate assessments in a wide variety of situations, be it sport, business or even war - though it also risks wreaking ever-greater havoc. The authors cite the 2008 financial crash and the 2003 Iraq war as just two examples of when extreme overconfidence backfired, though the 2003 Iraq War was the biggest rout in military history so evolutionary psychologists don't seem to understand 'winning' and conflate it with 'still having to occupy', which the U.S. also still does in Germany, Japan and South Korea and no one believes those were not victories.
The team from the University of Edinburgh and the University of California, San Diego used a mathematical model to simulate the effects of overconfidence over generations. They pitted overconfident, accurate, and underconfident strategies against each other.
Their paper published in Nature contends that overconfidence frequently brings rewards, as long as spoils of conflict are sufficiently large compared with the costs of competing for them. In contrast, people with unbiased, accurate perceptions usually fare worse. The implications are that, over a long period of time the evolutionary principal of natural selection is likely to have favored a bias towards overconfidence. Therefore people with the confidence of boxer Mohammad Ali would have left more descendants than those with the mindset of someone insecure.
Their evolutionary computer model also found that overconfidence becomes greatest in the face of high levels of uncertainty and risk. When we face unfamiliar enemies or new technologies, overconfidence becomes an even better strategy.
Dr. Dominic Johnson, reader in Politics and International Relations at the University said, "The model shows that overconfidence can plausibly evolve in wide range of environments, as well as the situations in which it will fail. The question now is how to channel human overconfidence so we can exploit its benefits while avoiding occasional disasters."
Like on Wall Street, computer models don't mean a lot when it comes to predicting behavior.