Identifying the Effects of Unjustified Confidence versus Overconfidence: Lessons Learned from Two Analytic Methods

Parker, Andrew M.; Stone, Eric R.

doi:10.1002/bdm.1787

Cited by 41 publications

(43 citation statements)

References 29 publications

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“…An additional analysis examining confidence after controlling for knowledge 51 (i.e. whether one is more or less confident than his knowledge would justify) similarly failed to find any group differences ( F [4,165]=2.1, p =0.09).…”

Section: Resultsmentioning

confidence: 94%

Decision-Making Competence and Attempted Suicide

Szántó¹,

Bruin²,

Parker³

et al. 2015

J. Clin. Psychiatry

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Objective The propensity of people vulnerable to suicide to make poor life decisions is increasingly well documented. Do they display an extreme degree of decision biases? The present study used a behavioral decision approach to examine the susceptibility of low-lethality and high-lethality suicide attempters to common decision biases, which may ultimately obscure alternative solutions and deterrents to suicide in a crisis. Method We assessed older and middle-aged individuals who made high-lethality (medically serious; N=31) and low-lethality suicide attempts (N=29). Comparison groups included suicide ideators (N=30), non-suicidal depressed (N=53), and psychiatrically healthy participants (N=28). Attempters, ideators, and non-suicidal depressed participants had unipolar non-psychotic major depression. Decision biases included sunk cost (inability to abort an action for which costs are irrecoverable), framing (responding to superficial features of how a problem is presented), under/overconfidence (appropriateness of confidence in knowledge), and inconsistent risk perception. Data were collected between June of 2010 and February of 2014. Results Both high- and low-lethality attempters were more susceptible to framing effects, as compared to the other groups included in this study (p≤ 0.05, ηp2 =.06). In contrast, low-lethality attempters were more susceptible to sunk costs than both the comparison groups and high-lethality attempters (p≤ 0.01, ηp2 =.09). These group differences remained after accounting for age, global cognitive performance, and impulsive traits. Premorbid IQ partially explained group differences in framing effects. Conclusion Suicide attempters’ failure to resist framing may reflect their inability to consider a decision from an objective standpoint in a crisis. Low-lethality attempters’ failure to resist sunk-cost may reflect their tendency to confuse past and future costs of their behavior, lowering their threshold for acting on suicidal thoughts.

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Section: Resultsmentioning

confidence: 94%

Decision-Making Competence and Attempted Suicide

Szántó¹,

Bruin²,

Parker³

et al. 2015

J. Clin. Psychiatry

Self Cite

View full text Add to dashboard Cite

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“…Although experts' decision rules are different and more accurate than those of novices (e.g., Alba & Hutchinson, 1987Hansen & Helgeson, 1996;Hauser, Dong & Ding, 2014;Newell et al, 2004), the findings in behavioural decision research suggest that people have unrealistic beliefs about how much they know and tend to overestimate their knowledge and ability in many different domains (Parker & Stone, 2014).…”

Section: Knowledge Calibrationmentioning

confidence: 99%

Industrial Designers: Are You Ready for Foreign Markets? Assessing Designer Confidence and Prediction Accuracy in a Transnational Marketing Context

Zhang

2015

Creat Innov Manage

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In order to boost sales in foreign markets and compete with emerging local competitors, global companies from developed countries are realizing that they need to develop products specifically for the local markets. Meanwhile, companies in developing nations are building up their design staff and seeking to establish their own global brands. This recent growth in design activity targeting overseas markets suggests the need for academic research to better understand the phenomenon of design expertise transfer across national borders. The present research explores industrial designers' expertise transfer across cultures with respect to knowledge calibration. Based on the literature on expertise and Shanteau's theory of expert competence, several hypotheses are developed regarding the main effect of culture, and the interaction between culture and expertise level, on design confidence and prediction accuracy. A three-phase experimental study is conducted to test the hypotheses. Results suggest that both expert designers and non-expert designers are poorly calibrated and overconfident. Nonetheless, expert designers are better calibrated when designing products for a foreign market than for their home market. Theoretical and managerial implications are discussed.

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“…See Parker and Stone (2014) and Parker et al (2012) for further discussion of confidence and overconfidence issues. The primary purpose of this study was to assess the financial capability of U.S. adults and provide baseline results that could be tracked over time.…”

Section: Dataset and Questionnairementioning

confidence: 99%

The Effects of Perceived and Actual Financial Literacy on Financial Behaviors

2015

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A combined measure of financial literacy that includes both a test score of actual financial literacy and a self-rating of overall financial literacy is used in this study. We find that the combined measure appears to provide greater understanding about how financial literacy affects financial behaviors. A large national survey of U.S. adults and households (n = 28,146) was used to investigate how this overall financial literacy is likely to change financial behaviors across five financial topics: credit cards, investments, loans, insurance, and financial advice. For each topic, we include 4-5 financial behaviors (22 in total) to demonstrate the consistency of the findings within and across topics. Although we are unable to identify a causal relationship, the results from the probit analysis show that both actual and perceived financial literacy appear to influence financial behaviors and that perceived financial literacy may be as important as actual financial literacy. (JEL D14, G00)

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Identifying the Effects of Unjustified Confidence versus Overconfidence: Lessons Learned from Two Analytic Methods

Cited by 41 publications

References 29 publications

Decision-Making Competence and Attempted Suicide

Decision-Making Competence and Attempted Suicide

Industrial Designers: Are You Ready for Foreign Markets? Assessing Designer Confidence and Prediction Accuracy in a Transnational Marketing Context

The Effects of Perceived and Actual Financial Literacy on Financial Behaviors

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