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John Spacey, September 30, 2016 updated on January 15, 2023
Self-defeating predictability is when a historical pattern makes a prediction obvious to multiple observers causing them to take actions that prevent the prediction from coming true. Actions taken to avoid risks and benefit from opportunities can cause such risks and opportunities to become less probable. The following are hypothetical examples.
MarketsIf a stock market historically goes up on December 15th, it makes sense for investors to buy on December 14th and sell on December 15th. If enough investors take this action, the market will be up on December 14th and down on December 15th. Generally speaking, any strong identifiable prediction in market prices causes that prediction to be less likely to materialize.VotingVoters who have heard in the media that their choice is predicted to win may be more likely to to stay at home.
FilmA highly anticipated film may generate inflated expectations that cause poor reviews.|
Type | EconomicsStatistical InferencePredictive Analytics | Definition (1) | Something that doesn't happen because it was predictable. | Definition (2) | The tendency for a predictable event not to occur due to efforts to exploit opportunities or mitigate risk associated with the event. | Also Known As | Self-defeating ProphecySelf-defeating ProbabilitySelf-defeating Prediction | Related Concepts | InvestingPredictive AnalyticsLogical Error |
Economics
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