The Bias-Variance Tradeoff and Why People Are So Bad at Predicting the Future and When Do Heuristics Work? Or: Why Bias Can Be Good
[This is post 4 in the "Structure and Cognition" series; links to all the posts can be found here ] I. If there were a contest for the scientific findings most embarrassing for human intelligence, the research comparing expert prediction to simple linear equations would be a strong contender. When this research program began in the 1940s, clinical psychologists were curious to see just how much better their clinical judgment would be than statistical models. Dawes and Corrigan (1974) note that “the statistical analysis was thought to provide the floor to which the judgment of the experienced clinician could be compared. The floor turned out to be a ceiling.” In summarizing this large body of literature, which repeatedly demonstrates the inferiority of human judgment, Nisbett and Ross (1980) write: "Human judges make less accurate predictions than formulas do, whether they have more information than is fed into the formula or precisely the same amount of information...