Hindsight Bias: When Experience Works Against You
Learning from the past—it’s the reasonable thing to do to improve and make progress. It turns out though, that its merit may well depend on what exactly we learn, since “looking back” is not without its downfall. Cue in hindsight bias.
What is Hindsight Bias?
Hindsight bias is the belief that past events were more predictable than they were before they happened. Richard E. Nisbett in The Geography of Thought: How Asians and Westerners Think Differently… and Why, writes:
“We tend to have two problems when we try to ‘predict’ the past: (1) believing that, at least in retrospect, it can be seen that events could not have turned out other than they did; and (2) even thinking that in fact one easily could have predicted [in advance] that events would have turned out as they did.”
The first pertains to the belief of the “inevitability” of certain events, which influences the mind to think of the cause and effects to describe this inevitability. Then, convinced of this causal relationship, the second follows. Applying the causal relationship, one should have known that the event would certainly happen. The problem with this is, it’s a fallacy. Nisbett continues to describe that certain cultural paradigms have greater tendencies to commit this fallacy, but more on that later in future posts.
Hindsight bias is what leads to phrases like “I knew it all along” or “I knew from before that this would happen.” Ironically, the people who commit this fallacy may sound like experts, gifted with certain prescience of events, and may become the go-to sources for future predictions. You’ve seen them on TV—people get over-credited for predictive knowledge because they say so-and-so should have known and done something so this other thing would have happened. The key illusion here is the belief that they understand the past–they have a model to explain the past–which they use to predict the future, while in fact they understand the past much less than they think they do.
The Mind That Cannot Revert Itself
In Thinking, Fast and Slow, Daniel Kahneman explains some of the mechanism that causes hindsight bias:
“A general limitation of the human mind is its imperfect ability to reconstruct past states of knowledge, or beliefs that have changed. Once you adopt a new view of the world (or of any part of it), you immediately lost much of your ability to recall what you used to believe before your mind changed.”
He continues to describe a psychology experiment to illustrate this point:
“Choosing a topic on which minds are not completely made up–say, the death penalty–the experimenter carefully measures people’s attitudes. Next, the participants see or hear a persuasive pro or con message. Then the experimenter measures people’s attitudes again; they usually are closer to the persuasive message they were exposed to. Finally, the participants report the opinion they held beforehand. This task turns out to be surprisingly difficult. Asked to reconstruct their former beliefs, people retrieve their current ones instead–an instance of substitution–and many cannot believe that they ever felt differently.”
Because the mind has a hard time reproducing its less knowledgeable state, over-simplification of the past or overconfidence happens.
“Your inability to reconstruct past beliefs will inevitably cause you to underestimate the extent to which you were surprised by past events.”
The less knowledgeable me saw things as complicated. But once I know, I couldn’t believe that a previous me ever thought things as complicated. It seems like there’s a limit to sympathy with my old self.
Asymmetric Perception
Our relationship with the past and future is very interesting. We know that the future is uncertain. I, right now, have many choices that could result in a plethora of outcomes. But I can only make one choice, and thus as I traverse through time, I will only have one version of history. Looking forward, I see a spectrum of possibilities, but looking back, I see only one. The fallacy arises if I believe that because I only see one history in my past, it is the only one version that could have happened while in fact, if I return to that point, just like my presence, I would have multiple choices as well. Other outcomes were just as probable.
This asymmetry of our perceptions with respect to time is a warning when we learn from the past since “the tendency to revise the history of one’s beliefs in light of what actually happened produces a robust cognitive illusion.” The lessons learned, or our model of what happened in the past, may be influenced by this bias, which may produce a story that’s too clean and tidy compared to reality.
Event A and B at two different times
Perception at time A. A range of possibilities of outcomes, of which B is an instance.
Perception at time B, the belief that A to B is inevitable.
When Experience Works Against You
Our view of the past influences our perception of the future. If our model of the past is too straightforward, we may be tempted to extrapolate the same behavior in the future and oversimplify, which can be serious if you were a decision maker. The failure to consider various possibilities of outcomes can lead to incorrect estimation of risks and failure to mitigate. But even if you weren’t a decision maker, the loss from hindsight bias, to me, is its opportunity cost. The disbelief that the future could not turn out another way may prevent you from exploring creative options.
In many areas of life, experience is highly valued in considering someone’s suitability for a job, rightly so. Experience can also be described as the quantity of past events in someone’s repertoire. It’s how much history he has in a particular area. It does not always mean that the person is older, although in most cases it correlates strongly with age.
For a job that requires expertise, experience is a definitely an advantage. Sometimes, though, a task requires creativity, innovation, new ways of looking at and doing things. For this type of work, experience may mean that the person’s mental model may be too rigid and solidified to consider alternatives.
I’ve been on both sides of this fallacy, both as the guilty party and the victim of hindsight bias. As the guilty one, I’ve said things like, “I knew all along this would work or that wouldn’t work out” and giving suggestions like “I’ve tried that, it didn’t work so don’t bother trying.” The root issue is believing that the cause and effect are clear, discounting other factors that also play big roles. Maybe sometimes it helps the recipients of this ‘advice’, but what if it’s actually misdirection?
As a victim of hindsight bias, I’ve been on the other side of experts and been told not to hope too much from a certain pursuit, or that my idea won’t work because it’s always done in certain ways. But because I don’t have much pre-knowledge, I’m less constrained to think in their ways and more motivated to pursue alternate ideas. When it comes to thinking divergently, which I believe is necessary in making progress that’s a leap rather than incremental, there’s an advantage to being young and inexperienced.
The Impossibles
Is there an escape from hindsight bias? I would think so. A conscientious approach to detect hindsight bias in ourselves may fix it and free us from limiting/false models from the past, and acknowledge the statistical nature of our world. But if Kahneman’s right, that our brain cannot fully sympathize with its less knowledgeable version in the past, maybe we cannot overcome hindsight bias 100% internally.
Which is why it’s great that there are other people, and sometimes a new person for in a position or as a leader is the best way to bring in new approaches, new visions, and new solutions. There’s a quote a movie that I love, “We are too young to realize that certain things are impossible…so we will do them anyway.” If we can be the one saying this, then great! But if it so happens that we can’t, then maybe we should at least have someone else in the team who can still say those words, and counteract our hindsight bias.
More on cognitive biases:
OK, But Not OK. Not OK, But OK
Image credit: Uxmas.com
