ALL YOU NEED IN THIS LIFE IS IGNORANCE AND CONFIDENCE; THEN SUCCESS IS SURE.
MARK TWAIN, LETTER TO MRS. FOOTE, 1887
Of all the errors and biases that undermine our judgment, the most frequently cited is overconfidence. Already in 1995, summarizing research from the previous two decades, behavioral economist Richard Thaler observed, “Perhaps the most robust finding in the psychology of judgment and choice is that people are overconfident.”1 Around the same time, psychologist Scott Plous reached a similar conclusion: “No problem in judgment and decision making is more prevalent and more potentially catastrophic than overconfidence.”2
Since then the notion that people suffer from overconfidence ...