I. Erev et al., SIMULTANEOUS OVERCONFIDENCE AND UNDERCONFIDENCE - THE ROLE OF ERROR IN JUDGMENT PROCESSES, Psychological review, 101(3), 1994, pp. 519-527
Two empirical judgment phenomena appear to contradict each other. In t
he revision-of-opinion literature, subjective probability (SP) judgmen
ts have been analyzed as a function of objective probability (OF) and
generally have been found to be conservative, that is, to represent un
derconfidence. In the calibration literature, analyses of OP (operatio
nalized as relative frequency correct) as a function of SP have led to
the opposite conclusion, that judgment is generally overconfident. Th
e authors reanalyze 3 studies and show that both results can be obtain
ed from the same set of data, depending on the method of analysis. The
simultaneous effects are then generated and factors influencing them
are explored by means of a model that instantiates a very general theo
ry of how SP estimates arise from true judgments perturbed by random e
rror. Theoretical and practical implications of the work are discussed
.