Who’s better at predicting threats, conflicts and their outcomes: policymakers and pundits, or a bunch of average slobs? According to one recent study, they’re all about the same:
The research can have serious consequences for foreign policy and business. [Co-author Kesten] Green says, “Political leaders in the West are pondering how best to deal with the threat of the Iranian government’s nuclear ambitions. Forecasting problems such as this are the stuff of not only international relations but also of takeover battles, commercial competition, and labor-management disputes. In most cases, experts use their judgment to predict what will happen. How good are their forecasts?
“The short answer is that they are of little value in terms of accuracy. In addition, they lead people into false confidence.” …
The case studies were diverse: they included a hostile takeover attempt, nations preparing for war, a controversial investment proposal, a nurses’ strike, an action by football players for a larger share of the gate, an employee resisting the downgrading of her job, artists demanding taxpayer funding, and a new distribution arrangement that a manufacturer proposed to retailers. …
Analysis of additional data produced similar results. In one instance, the authors attempted to determine if veteran experts would be more likely to make accurate forecasts than less experienced experts. “Common sense expectations did not prove to be correct,” they write. “The 57 forecasts of experts with less than five years experience were more accurate (36%) than the 48 forecasts of experts with more experience (29%).”
This would come as no surprise to James Surowiecki, whose excellent book The Wisdom of Crowds contends that individuals, regardless of their supposed expertise, are usually dumber than the aggregated wisdom of a loose network of diverse amateurs who all approach a problem from different perspectives. The magic is in the aggregating. Get that right and you can do a pretty good job of predicting almost anything.
For some reason, I’m reminded of something an officer friend of mine, a recent Iraq veteran, said in a bar one night. ”If you ask anyone who understands Iraq if they understand Iraq, they say, ’No.’ Anyone who knows anything about Iraq knows they don’t know anything.”
(Before you go flaming me in the comment section: yes, I am aware of the irony of experts saying experts can’t be trusted.)