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THE PREDICTION TRADE
Open-Minded Forecasting in a Deeply Polarized World Superforecasters share three strategies for making accurate predictions By Warren Hatch
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mericans are more polarized than ever, and their split along two ideological extremes complicates a forecaster’s job. Polarization stresses feelings over facts, confounding the separation of signal from noise that’s essential to forecasting accuracy. Also, the forecaster’s own biases and preferences can be harder to recognize— and set aside—when society at large is polarized and the outcomes are personally consequential. When Good Judgment Inc, a forecasting company, asked its professional Superforecasters to predict the outcome of the 2020 U.S. election cycle, these challenges were front and center. Many Superforecasters live in the United States and feel deeply about political issues in the country. Some of them worried this could cloud their
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forecasting judgment. Here’s what they did, and what you can do to improve the accuracy of your own predictions in a polarized world. U.S. election 2020 The Superforecasters predicted in March 2020 that the Democrats would win the White House and never looked back. As early as June, they began predicting both the House and Senate would go to the Democrats. They accurately called:
• the long-delayed concession • the record voter turnout, and • the Democrats’ presidential fundraising edge as of Sept. 30 But getting it right is only half of the picture. Good Judgment strives to be right for the right reasons. To calibrate their thinking, Superfore-
casters use three simple strategies that consistently result in more accurate predictions. Consider alternatives While the Superforecasters as a group assigned high odds for a Democratic sweep, individual Superforecasters predicted a variety of outcomes. A diversity of views is essential for good forecasting, but on issues you hold dear, considering other views is easier said than done. Over the week before the election, Good Judgment asked the Superforecasters as a group to imagine they could time-travel to a future in which the Republicans retained both the White House and the Senate. Regardless of their individual forecasts, they were then asked to explain why a “blue wave” election failed to occur in such a future. This is called a pre-mortem, or “what if” exercise. Thinking through alternative scenarios ahead of the actual outcome accomplishes several goals. It forces the forecaster to consider other perspectives and to rethink the reasoning and evidence supporting their forecasts. It also tests the forecaster’s level of confidence (over-confidence being far more common than under-confidence) and helps forecasters avoid hindsight bias when evaluating the forecasts later. Because Superforecasters already weigh multiple alternatives in making forecasts, this pre-mortem produced little change in the over-
On issues you hold dear, considering other views is easier said than done.
Tune in for Season 2 of The Prediction Trade podcast from Luckbox. It features all-new ways to make money by forecasting the financial markets, politics, crypto, sports and other events where it’s legal to wager.
Luckbox | April 2021
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