The Inconsistency of Human Judgment

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Human judgment is often inconsistent due to various biases and errors, with personal inconsistency explaining about 20% of the variation in judgments. Factors like mood, recent experiences, and external influences can significantly impact decisions, such as risk tolerance being affected by irrelevant external factors like exposure to smiling faces or recalling past emotions. Experimental setups have shown that even subtle changes, like displaying smiling faces, can alter decision-making behavior. Ultimately, human decisions can be influenced by irrational and unpredictable factors, leading to variations in judgment.

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Can we measure everything that matters to us? When is measuring the correlates of a thing pretty much just as good as measuring the thing itself? Why are some people resistant to measuring certain things? What are some things people should be measuring but aren't? What's the connection between measuring things and assigning probabilities to events? How much do we know about how well human intuition performs against "doing the math"? How inconsistent are we at applying our own principles in decision-making? What kinds of calibration training are effective? What is "value of information"? What is the Rule of 5? What are the top three things we can do to improve our decision-making?

Douglas Hubbard is an author, consultant, and recognized expert in decision theory and risk analysis. He has written several books on measurement and measuring risk. His work spans various industries including insurance, finance, pharmaceuticals, aerospace, military, energy, government, tech, and nonprofit organizations. Connect with Doug on LinkedIn, email him at dwhubbard@hubbardresearch.com, or learn more about his work at hubbardresearch.com.

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