People judge themselves by their intentions and others by their actions. For this reason, there is a difference between how others evaluate us and how we evaluate ourselves. This becomes most evident during performance reviews. The narcissism pandemic, particularly among the younger generation influenced by American psychology, has led people to believe they possess traits they do not have and to exaggerate the traits they do have. This development has also been fueled by parents convincing their children that they are ‘unique’ and that the world owes them something. As a result, the world is now filled with people who believe they have ‘rights’ but are unaware of their responsibilities. A thinker once said, ‘God, give me the strength to see myself as others see me,’ in an effort to bridge the gap between reality and our perception.
Our ancestors used to say, ‘Wisdom went to market, and everyone took their own.’ While a person may not believe they are the smartest in the world, they do believe they are smarter than those around them, which is why no one gives up on their own wisdom. How realistic are people when evaluating themselves? How much of our self-confidence is based on objective facts? Exploring these questions can provide both fun and enlightening results. To begin, it would be helpful to look at a study conducted in Seattle on the west coast of the United States.
About 30 years ago, two psychiatrists in Seattle asked fifty drivers the following question: “How would you rate your driving skill, alertness and mental state the last time you were behind the wheel?” Most of the drivers rated themselves and their state as ‘very good’ or ‘100%’. But what made it extremely interesting was that these interviews were conducted in a hospital and the drivers were brought in by ambulance. According to the police reports, 66% of the drivers were fully responsible for their mistake. More than half of them had totaled their cars and nearly half of them would have been convicted in court. Only five drivers out of fifty admitted to being “partly” at fault. When these five people were examined in more depth, they were found to have depressive tendencies. From this perspective, it is safe to conclude that people with depressive tendencies are more realistic assessors of their own abilities.
Do you think there is a special reason why drivers are so delusional and misjudge themselves so much? You may be surprised, but the answer to this question is that this attitude is “normal” human behavior. In past years, when I have asked participants at meetings to raise their hands if they think that they are above average in terms of mental skills (sales skills, management skills, etc.) when compared to others around them, I have never witnessed less than three quarters of the people in the room raise their hands.
Every person sees themselves as more beautiful, handsome and talented than they really are. As our ancestors say, “a raven’s young looks like a hawk” and after a while the raven believes it. As we mentioned above, this is a “normal” human behavior. However, the problem at this point is one of measure. When the measure is missed, we end up with what we call “imprudent optimism” or “blind optimism”, which often leads to regrettable and sometimes even disastrous steps or investment decisions in terms of money-related decisions.
Dose is Poison
Kahneman has said that “an absolute realism about success would result in the inability to take any risks”. This would undoubtedly mean not being able to make decisions on anything important. This would not lead to positive outcomes for human beings.
In a survey of three hundred entrepreneurs, they were asked “what are the chances of success for a venture like yours?”. 39% of the respondents said that the chances of failure were no less than 7 out of 10. However, when asked “how do you rate your own chances of success?”, 81% of the respondents answered “more than 7 in 10”. 33% of the respondents were confident enough to rate their chances of failure as zero percent. Yet, available data shows that 50% of new ventures fail in the first five years.
Positive thinking and optimism are “good”. But it is important to remember that “the dose is poison”. Unrealistic optimism and overconfidence are the biggest hindrances to making decisions with money, as well as any decision involving uncertainty. The motto “Think well, do well” is a naive approach that does not represent the realities of life. Just like the “law of attraction” in Rhonda Byrne’s “The Secret”. This approach also does not represent life and has no scientific basis. The belief that one can turn matters and events outside oneself in the direction one wants with the “power of will” is a belief reserved for the gullible.
Conclusion
People like the idea that things will get better on their own, without any effort on their part, even if they don’t admit that they are naive. This is probably why people vote for the politician who makes the biggest promises, even though they know that the politician’s promises will not come true.
Sources:
Ola Svenson: “Are we all less risky and more skillful than or fellow drivers?” Acta Psychologica Vol 47. (1981)
Daniel Kahneman: Remarks at the Institute of Certified Financial Planners. Wealth Management Symposium. New York. (1999)
(*) This article has been taken with modifications from the book “Decisions are the Punishment for Mindless Emotions”.
