Overconfidence is a tendency to overestimate your capabilities and underestimate challenges, risks and competition. The following are common types of overconfidence.Optimism is a tendency to play up positive information and downplay negative information. This is a positive trait that is associated with creativity and an ability to develop productive relationships that are win-win. That being said, optimism is a common root cause of overconfidence. This can be prevented with techniques such as defensive pessimism.
Wishful-thinkingEstimates and predictions based on what you want to happen as opposed to evidence.A corporate culture with excessive pride that leads to negative behaviors such as viewing customers as unintelligent and competitors as weak.
Dunning-Kruger Effect A tendency for incompetent individuals to view a task as easy and highly competent individuals to view the same task as difficult. This may be due to the incompetent individual misunderstanding the complexities and risks involved in the task. For example, a physicist may propose a high speed train system with some initial calculations and suggest it can be built in a year for $1 billion. A seasoned designer of high speed trains may look at the same system and estimate the development time at 10 years with $22 billion. The physicist may be thinking purely in terms of the physics of shooting a vehicle down a tube without considering implications in areas such as safety, passenger comfort and operations.
Overconfidence EffectThe tendency for overconfident individuals to view their judgments as extremely accurate. For example, an individual who develops an accurate prediction may have only moderate confidence in it. An individual who develops an inaccurate prediction may be extremely confident that it is correct.
Above Average Effect A tendency for most people to view themselves as above average in certain areas. This is impossible as most people can't be above average by definition. For example, a city where 85% of families believe they have above average family income for their area.
Illusory SuperiorityAn individual who believes they are superior to others without sufficient hard evidence to support this idea. This may be a coping mechanism that gives a person confidence. In some cases, illusory superiority may simply ignore negative evidence such as a soccer player who feels they are superior despite poor performance outcomes. More commonly, illusory superiority occurs in areas that are difficult to judge such as leadership or social status. For example, an individual who views themselves as a cultural elite because they eat artisanal food. This may be an illusion because few independent observers would view this as a significant cultural accomplishment such as mastering the violin.
Positive Illusions Being too positive about yourself and groups to which you belong as a calculated strategy. This is a part of normal thought and can be used as a practical approach to improving happiness and results. For example, a public speaker who strongly believes they are a good public speaker may perform better than a public speaker who has a low opinion of their own abilities. Likewise, having overconfidence in those around you tends to make you likeable and may inspire people to try to live up to your high opinion of them. This is known as the heliotropic effect.
Illusion of ControlThe belief that you can control things where you have little or no control in reality. The classic example is a gambler who "has a system."Extreme overconfidence that is far detached from reality such that people might not even understand what you are talking about. For example, a new hire out of university who goes straight after the CEO's job in a large firm.
A tendency for overconfident people to fail but then be rewarded anyway. This may be related to traits such as aggression, sociability, resilience, risk taking, decisiveness and a willingness to provide direction in the face of uncertainty.
NotesAll else being equal, it is possible for overconfident people to outperform realistic people over time as they are exposed to more learning opportunities such as failure, stresses and intensive competition. In other words, taking on excessive and miscalculated risk can be beneficial if you are lucky enough to survive it.
This is the complete list of articles we have written about risks.
If you enjoyed this page, please consider bookmarking Simplicable.
A list of abilities that are commonly viewed as a talent as opposed to a commodity skill.
An overview of personal resilience with examples.
Common examples of self-improvement.
The definition of credibility with examples.
The definition of attention to detail with examples.
The definition of career path with examples.
The definition of mastery with examples.
A list of common leadership skills.
An overview of personal goals with examples for professionals, students and self-improvement.
An extensive list of risks and risk management techniques.
How to calculate relative risk with examples.
The definition of risk aversion with examples.
The common types of career risk.
The definition of angst with examples.
The definition of systemic with examples.
The definition of failure with examples.
The definition of pure risk with examples.
The definition of speculative risk with examples.
The definition of personal risk with examples.
TrendingThe most popular articles on Simplicable in the past day.
Recent posts or updates on Simplicable.
© 2010-2023 Simplicable. All Rights Reserved. Reproduction of materials found on this site, in any form, without explicit permission is prohibited.
View credits & copyrights or citation information for this page.