Why Your Brain Is Bad at Predicting the Future

Your brain gets the future wrong in three predictable ways. It underestimates how long things will take (the planning fallacy, named by Daniel Kahneman and Amos Tversky in 1979). It overestimates how strongly and how long you'll feel about what happens (the impact bias, from Timothy Wilson and Daniel Gilbert's work on affective forecasting). And it assumes the person you'll be later will want what you want now (projection bias, formalised by George Loewenstein, Ted O'Donoghue and Matthew Rabin).

You think the project will take two weeks. You think you'll be crushed if the offer falls through. You think you'll still want the thing next month as much as you want it today. Each guess feels like a reasonable read of the facts. Each tends to be off in the same direction, every time.

Knowing about these errors doesn't switch them off. What it does is let you build a few checks around them, and those checks are what this article is about.

The planning fallacy: why projects run late

Kahneman and Tversky described the planning fallacy as the tendency to underestimate how long a task will take, how much it will cost and how much will go wrong, even when you know that similar tasks ran late before.

The big examples are famous. The Sydney Opera House was budgeted at A$7 million with completion in 1963. It opened in 1973 at a cost of A$102 million. When Bent Flyvbjerg and colleagues studied 258 transport infrastructure projects, about nine in ten had gone over budget, by 28% on average.

The small examples are more telling. Roger Buehler, Dale Griffin and Michael Ross asked students to predict when they'd finish their senior theses, including a best guess and a "if everything goes wrong" guess. Fewer than a third finished by their best guess. On average they took longer than even their worst-case estimate.

The reason is how we picture a plan. You imagine the steps in order, and the imagined version is a smooth one. It doesn't include the week your supplier goes quiet, the assumption that turns out to be wrong, or the decision that gets reversed. Those events aren't in the picture, so they aren't in the estimate.

The fix: take the outside view

Kahneman called the picture-the-steps approach the inside view. The alternative is the outside view: set aside the details of your project and ask how long projects like it usually take.

Kahneman tells a story about himself. Early in his career he was part of a small team writing a school textbook on judgment. A year in, he asked everyone to estimate how long it would take to finish. The answers clustered around two years. Then he asked the team's most experienced member how long similar teams had taken. After some thought, the man said that about 40% never finished at all, and that none he knew of had finished in less than seven years. The team carried on anyway. The book took eight years and was never used.

The practical version is simple. Before you commit to an estimate, find a reference class (the last ten features your team shipped, the last few kitchen renovations your friends did) and look at how long those actually took. Start from that, then adjust for what's genuinely different about yours.

Affective forecasting: you're wrong about how you'll feel

Affective forecasting is predicting how you'll feel about future events. Wilson and Gilbert found that people are usually right about whether something will feel good or bad, and usually wrong about how much and for how long. They called this overestimate the impact bias.

In one study, Gilbert and colleagues asked assistant professors to predict how happy they'd be in the years after a tenure decision. They expected that getting tenure would leave them much happier than being turned down. When the researchers surveyed people who had actually been through both outcomes years before, the gap in happiness was far smaller than predicted.

Two mechanisms explain much of it.

The psychological immune system. After a setback, people rationalise, reframe and find reasons it wasn't so bad, mostly without noticing. Because they don't notice it, they leave it out of their forecasts. You picture the raw disappointment and not the recovery.

Focalism. When you imagine a future event, you imagine that event, and not the rest of your life carrying on around it. Wilson and colleagues found that football fans overestimated how much a match result would affect their mood in the following days. When they were first asked to think through what else they'd be doing those days, their forecasts became more accurate.

This matters because so many big choices rest on a feeling forecast: the job, the city, the purchase. You choose partly on how you expect to feel once you're there, and that expectation is reliably inflated.

The fix: ask someone who's been there

Gilbert, Matthew Killingsworth and colleagues tested a blunt alternative to imagining. In one study, women were about to go on a short speed date. Some saw the man's profile and photo and predicted how much they'd enjoy it. Others saw no profile, only a rating from a woman who had just been on a date with him. The second group predicted their own enjoyment more accurately, even though most of them expected the profile to be more useful.

The lesson is uncomfortable because we think our reaction will be unusual. Usually it isn't. If you're weighing a move from a corporate job to a startup, a few honest conversations with people who made that move a couple of years ago will probably tell you more about how you'll feel than your imagination will.

Projection bias: you assume future you will feel like you do now

Loewenstein, O'Donoghue and Rabin described projection bias as underestimating how much your tastes will change with your state. You know you won't always feel this hungry, this excited or this tired. You just don't adjust enough for it.

The evidence is surprisingly concrete:

• Weather and cars. Meghan Busse and colleagues found that more convertibles are sold on unusually warm, sunny days, and more four-wheel-drive vehicles after snowstorms, as if buyers expect today's weather to describe the car's whole life.
• Weather and coats. Michael Conlin, O'Donoghue and Timothy Vogelsang found that cold-weather clothing ordered on an unusually cold day was more likely to be returned.
• Hunger and snacks. Daniel Read and Barbara van Leeuwen asked office workers to choose a snack they'd receive a week later. Those asked when they were hungry, late in the afternoon, chose unhealthy snacks more often than those asked just after lunch.

Hot states and cold states

Loewenstein's term for this is the hot-cold empathy gap. In a hot state (hungry, angry, excited, afraid) you can't easily imagine how you'll feel when calm, so you make commitments that calm you won't want. In a cold state you underestimate how much a future hot state will push you around. The person who is sure they'll stick to the plan hasn't pictured 4 p.m. on a bad day.

The fix: set rules in one state, follow them in the other

Make the rule while you're calm and let it bind you when you're not. Ulysses had himself tied to the mast before he heard the sirens, a pre-commitment move that does more than willpower. Ordinary versions:

• Wait 48 hours before any non-essential purchase above a set amount.
• Don't agree to new commitments in the moment. Say "I'll confirm tomorrow."
• Write the shopping list before you're hungry, and buy from the list.
• For bigger choices, run the 10-10-10 rule: picturing yourself in 10 minutes, 10 months and 10 years forces you to imagine states other than the one you're in.

The three errors together

Bias	What goes wrong	Where it costs you
Planning fallacy	Tasks take longer and cost more than you estimate	Projects, deadlines, budgets
Impact bias	Future feelings are weaker and shorter than you predict	Big life decisions, avoiding risk
Projection bias	You assume your current state will last	Purchases, commitments, habits

They stack. You make an optimistic plan, expect to feel better than you will when it works out, and assume you'll still want it by the time it arrives.

None of them goes away with awareness. Kahneman knew all about the planning fallacy and still watched the textbook take eight years. What awareness buys you is the motivation to add structure: reference classes instead of inside-view guesses, reports from people who've been there instead of imagination, and rules made in a cold state instead of decisions made in a hot one.

A three-question check for any decision about the future

1. What does the reference class say? Find people who did something similar and look at how it actually went: how long, how much, what went wrong. Start your plan from there.

2. How do people feel after this, months later? Talk to people who've lived the outcome, and ask how they felt six months on, not what they'd recommend.

3. Am I in the right state to decide? If you're angry, euphoric or exhausted, wait. If you're calm and deciding about a situation that will be heated, write the rule now.

How far does your confidence run ahead of you?

All three errors share a root: feeling surer than the evidence warrants. The Bayesian Betting Hall is a short calibration test. You bet on ten claims, say how sure you are of each, and see your average confidence next to how often you were right. It's a small sample, but it shows the gap these biases live in.

Frequently Asked Questions

What is the planning fallacy in simple terms?

It's the tendency to underestimate how long a task will take and what it will cost, even when you know similar tasks ran late before. Kahneman and Tversky named it in 1979, and studies since have found it in students, engineers and governments alike.

What is affective forecasting?

It's predicting how you'll feel about future events. Wilson and Gilbert's research shows people usually get the direction right but overestimate how intense and long-lasting the feeling will be, which they called the impact bias.

What is projection bias?

It's assuming your future self will want what you want now. Loewenstein, O'Donoghue and Rabin formalised it, and studies of car purchases, clothing returns and snack choices show people's current state colours choices meant for later.

What is the outside view?

It's estimating from what happened to similar cases instead of from your picture of this one. Kahneman contrasted it with the inside view, which is nearly always more optimistic than the track record supports.

Can knowing about these biases help?

Not much on its own. Even the researchers who discovered them still fall for them. Structural fixes work better: reference classes, advice from people who've lived the outcome, and rules set in advance.

Sources

1. Kahneman, D., & Tversky, A. (1979). Intuitive prediction: Biases and corrective procedures. TIMS Studies in Management Science, 12, 313–327.
2. Buehler, R., Griffin, D., & Ross, M. (1994). Exploring the "planning fallacy": Why people underestimate their task completion times. Journal of Personality and Social Psychology, 67(3), 366–381. https://doi.org/10.1037/0022-3514.67.3.366
3. Flyvbjerg, B., Holm, M. S., & Buhl, S. (2002). Underestimating costs in public works projects: Error or lie? Journal of the American Planning Association, 68(3), 279–295. https://doi.org/10.1080/01944360208976273
4. Kahneman, D. (2011). Thinking, Fast and Slow. Farrar, Straus and Giroux. Chapter 23, "The Outside View."
5. Gilbert, D. T., Pinel, E. C., Wilson, T. D., Blumberg, S. J., & Wheatley, T. P. (1998). Immune neglect: A source of durability bias in affective forecasting. Journal of Personality and Social Psychology, 75(3), 617–638. https://doi.org/10.1037/0022-3514.75.3.617
6. Wilson, T. D., Wheatley, T., Meyers, J. M., Gilbert, D. T., & Axsom, D. (2000). Focalism: A source of durability bias in affective forecasting. Journal of Personality and Social Psychology, 78(5), 821–836. https://doi.org/10.1037/0022-3514.78.5.821
7. Gilbert, D. T., Killingsworth, M. A., Eyre, R. N., & Wilson, T. D. (2009). The surprising power of neighborly advice. Science, 323(5921), 1617–1619. https://doi.org/10.1126/science.1166632
8. Loewenstein, G., O'Donoghue, T., & Rabin, M. (2003). Projection bias in predicting future utility. The Quarterly Journal of Economics, 118(4), 1209–1248. https://doi.org/10.1162/003355303322552784
9. Busse, M. R., Pope, D. G., Pope, J. C., & Silva-Risso, J. (2015). The psychological effect of weather on car purchases. The Quarterly Journal of Economics, 130(1), 371–414. https://doi.org/10.1093/qje/qju033
10. Conlin, M., O'Donoghue, T., & Vogelsang, T. J. (2007). Projection bias in catalog orders. American Economic Review, 97(4), 1217–1249. https://doi.org/10.1257/aer.97.4.1217
11. Read, D., & van Leeuwen, B. (1998). Predicting hunger: The effects of appetite and delay on choice. Organizational Behavior and Human Decision Processes, 76(2), 189–205. https://doi.org/10.1006/obhd.1998.2803