Credit Suisse Global Financial Strategies analysts Michael J. Mauboussin and Dan Callahan shed light on how our minds confuse skill and luck in their work “Outcome Bias and the Interpreter” of October 15, 2013.
What is Outcome Bias?
People are guilty of outcome bias when they blindly ascribe a good outcome to a good decision and a bad outcome to a bad decision, regardless of the real quality of the decisions taken.
A football coach, faced with a split-second choice, may have made the correct decision given the circumstances, but the outcome could be unfavorable. A third person, not having all the information available to the coach, may unfairly blame the...
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