nobel prize

Can You Be Too Confident?

Yes. Because, according to Daniel Kahneman, author of the new book "Thinking Fast and Slow," "people are blind to their own blindness." In this great NYTimes article excerpt from his book, he demonstrates how people, even when faced with evidence that their conclusions are incorrect, will continue to insist that their process yields good results. Which immediately makes me think about all the nonsense out there around hiring.

And entrepreneurship - how does anybody predict who will be a good entrepreneur/CEO? It's difficult. As Kahneman puts it, "True intuitive expertise is learned from prolonged experience with good feedback on mistakes. ...To know whether you can trust a particular intuitive judgment, there are two questions you should ask: Is the environment in which the judgment is made sufficiently regular to enable predictions from the available evidence? The answer is yes for diagnosticians, no for stock pickers. Do the professionals have an adequate opportunity to learn the cues and the regularities? The answer here depends on the professionals’ experience and on the quality and speed with which they discover their mistakes."