Why Prefer Potential?

Movies that win Oscars seem to gain more viewers as a result. But it also seems that on the whole people are a lot more eager to watch Oscar nominated movies before the Oscar winners are announced. After the show, people think less about movies and more about other things. Which is odd – a burst of info comes out about which movies are good, and in response people get less interested in watching movies. If getting info about movie quality makes people like movies less, that might explain why movie execs were so keen to kill movie prediction markets. But it still leaves us with the basic puzzle: why don’t people like info on movie quality?

Actually, this is part of a much bigger puzzle. Regarding basketball players, leaders, job candidates, comedians, grad school admissions, restaurant reviews and paintings, we actually prefer to choose people described as having the potential to achieve certain things, compared to people who actually achieve those same things:

When people seek to impress others, they often do so by highlighting individual achievements. Despite the intuitive appeal of this strategy, we demonstrate that people often prefer potential rather than achievement when evaluating others. Indeed, compared with references to achievement (e.g., “this person has won an award for his work”), references to potential (e.g., “this person could win an award for his work”) appear to stimulate greater interest and processing, which can translate into more favorable reactions. This tendency creates a phenomenon whereby the potential to be good at something can be preferred over actually being good at that very same thing. We document this preference for potential in laboratory and field experiments, using targets ranging from athletes to comedians to graduate school applicants and measures ranging from salary allocations to online ad clicks to admission decisions. …

Although participants recognized that the individual with achievement was more objectively impressive on paper, they showed a general preference for potential in their hiring decisions and assessments of future success. …

We ruled out a pro-youth bias, an extremity effect, and believability or credibility perceptions as viable alternative accounts for our findings.  (more; HT Tyler)

Weird! These authors even found this effect for paintings themselves, and not just for painters. They do convincingly argue that a proximate cause is interest and deeper reasoning caused by the uncertainty, but I find it hard to see those as ultimate causes. Why are we more interested in reasoning about potential rather than achievement?

Katja Grace suggested one plausible theory to me: we hope or expect to get a better price on things with good potential, relative to good achievement. This can make some sense of our preference for potential in hiring or grad school admissions; the candidates who have actually achieved may demand more in compensation, or be more likely to reject our offer.

It might also make more sense for paintings and basketball, if we were planning to buy the painting or hire the player. But a simple price effect makes less sense if you are not going to buy the painting or hire the player, but just be a fan. This also makes less sense for movies, comedians, restaurants; few of us ever buy these things whole. We instead pay to rent them, and we don’t get better prices there if we buy potential.

The Oscars suggest a related idea: what we want is social credit for anticipating fashion. That is, we want credit for being early in evaluating things highly that others will later evaluate highly. We want to able to brag (indirectly of course) that we saw quality first. Which is plausible. But it suggests that fashion is a surprisingly big part of our lives – desires to be first in fashion drives a lot more of our behavior that we like to admit.

In fact, this seems a good test probe – let’s test this effect in many more areas of life. Areas where potential matters more than achievement are good candidates for areas where fashion matters a lot to us.

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    Perhaps winning the award doesn’t add much value in the eyes of the people (number 1 is only marginally better than numbers 2 through 5, and all 5 are so much better than the average that the precise ranking within this top 5 doesn’t matter much), if people also believe the number 1 spot is assigned through politics and trades (in the case of the oscars, the academy doesn’t like giving the awards for best director and best film to the same film) then people care more about being nominated than about winning. Plus, if people have already checked out all the nominations, that includes the winner, why would they need to check it out again?

  • Anonymous

    Watching the Oscars feels very similar to watching a football match. Do supporters look up (highlights of) old matches of the teams that are going to play each other?

  • blink

    The puzzle is real and interesting, but I do not see the Oscar’s as an example. Instead, I think the “nomination boost” that movies receive reflects interest in the competition: I want to see the movies so that I can have an opinion about which deserves to win and can cheer or jeer the Academy’s choices.

    Sure, winning signals higher quality and I may regretting missing a movie that wins awards, but that is distinct from the motivation to watch it. Similarly, after an athlete wins an Olympic medal (or team wins a championship), I may regret not following the person, but I am not inspired to go back and watch all of the athlete’s previous performances.

  • Granite26

    My opinion (re the Oscar’s at least) is that it is the nominations that contain most of the information. (These are the best 5 movies this year). This is especially true when you factor in number of nominations. As mentioned by IMASBA, I look at the films that are nominated. I already know if I want to see them by the time the award is given.

    There is significantly less information contained in who actually wins, i.e. this is the ‘best’ out of the 5(10 now?) nominations.

    The scare quotes deserve their own mention. I trust the film actors guild to pick really good movies for the awards, but I don’t necessarily trust them to pick the best movie to win.

    I may be a bad example, though. The last non-cartoon I’ve seen that won awards was The King’s Speech.

    • Peter David Jones

      The nominations contain more useful information, because you can pick a movie that matches your taste.

    • http://www.gwern.net/ gwern

      Yes. On an information account, you would expect more movie watching activity based on the announcement of the nominations, because they specify the best 5-10 out of several hundred movies, while the awards are merely 1 out of 5-10. So percentile-wise, you learn several times more from nominations. Getting an Oscar nomination is a better signal than getting an Oscar win after an Oscar nomination. And unless movie quality is distributed according to some sort of fat tail where the best movie is way better than the second-best movie (and/or the award measurement is highly reliable), knowing which one wins the award reduces movie viewing regret only a little bit. This also sounds like it could explain an apparent general preference for ‘potential’ – many definitions of ‘potential’ actually measure some achievement and are more incrementally informative over base rates than accomplishments are over potential.

  • Tom

    Let’s go with the Oscars. The movies that got nominated had already been in theaters sometime in the previous year. The critic reviews probably haven’t changed much and the IMDb score has almost certainly gone down by the time Oscar nominations are announced. Waiting until Oscar season basically means that an individual decided to skip out on the film the first time around (barring cases where the film didn’t play in a nearby theater).

    To me this suggests that they may not have been particularly interested in the movie itself, but rather were engaged in the contest for the Oscar and wanted to check out the contenders. Once the contest is over, they lose interest and revert to their list of movies to see.

  • Dave Lindbergh

    Movie execs likely oppose movie prediction markets because they fear that conflicts of interest will cause manipulation of movie rankings.

    Those who tweet about movies may affect perception of movies, but they don’t have a financial interest in doing so.

  • Silent Cal

    If the preference for potential is about social credit, should we expect it to be reduced in near mode?

    To test this… maybe the far mode condition could be indicating on a survey how interested you are in seeing a movie, and the near mode condition would be choosing between free immediate tickets and a lower-nominal-valued cash reward?

    • http://juridicalcoherence.blogspot.com/ Stephen Diamond

      If the preference for potential is about social credit, should we expect it to be reduced in near mode?

      I’d predict it could be reversed in near mode.

      Potential is far; achievement is near (except perhaps if it occurred in the distant past). The experimental manipulations (as far as I can tell from the Abstract) activated far mode.

      The result is weird only if you neglect CLT.

  • Ben Albert Pace

    Given my actions, I imagine that my brain works like this for most things. It makes me interested in learning about things and watching things that I can gain status by knowing about – I have motivation to watch films when I know I can gain status by discussing it, and I learn about new discoveries in fields I’m interested in when I expect to be able to discuss the cutting edge of discovery and thus gain status, rather than spending my time studying settled science. Admittedly, I also try to spend a lot of my time studying settled science (intro textbooks) but I can see that I’m more interested in areas that I think are higher status e.g. undergrad maths and physics, which are highly non-practical in my planned career. These fields, however, can strongly distinguish intellectual ability, and so they’re attractive for gaining status, so I’m probably highly attracted to them for this reason.

    I wrote this as an example of going down the rabbit-hole of motivation.

    So how can one distinguish between what one would truly wish for one to be doing, and what one’s brain tells one to do for status?

    • IMASBA

      “So how can one distinguish between what one would truly wish for one to be doing, and what one’s brain tells one to do for status?”

      You are your brain and trying to gain status is part of what you truly wish to be doing, at least in one of your mind’s modes.

      • Ben Albert Pace

        That phrase ‘truly wish’ carries much philosophical baggage. I suppose I’m asking how to figure out which values your brain is using to give you motivation to do something. If you can figure out what value you are being motivated by, you can reflectively decide how much you wish to be motivated by that value. It is important to notice that we are often motivated by values we would, on reflection, reject.

      • http://juridicalcoherence.blogspot.com/ Stephen Diamond

        I suppose I’m asking how to figure out which values your brain is using to give you motivation to do something.


      • IMASBA

        “If you can figure out what value you are being motivated by, you can reflectively decide how much you wish to be motivated by that value. It is important to notice that we are often motivated by values we would, on reflection, reject.”

        Ah, I see. You want to put more emphasis on your far mode wishes (at least that’s what you want to do when in far mode). you can do this with some effort, but do remember that it won’t necessarily make you happier. That gut feeling of “yeah, I guess I am pretty happy with my life” comes mostly from near mode considerations.

  • arch1

    At the Nobel banquet Feynman sat next to a Swedish royal who asked what his field was. IIRC the gist of the ensuing discussion was:
    F: Physics
    R: Oh, we can’t talk about that, no one knows anything about physics.
    F: Actually it’s the opposite – people have a hard time talking about physics because something *is* known about it.
    ..so maybe the reason people make a bigger fuss over potentials than over achievements, is because the former is inherently more uncertain, thus giving greater scope for pundtry & pontification.

  • GMU Water Cooler Talk

    Basically agreed, but it gets weirder. If people really cared about quality, they’d watch “old” movies (Sunset Blvd. is criminally underwatched) and read older books (definitely more than the past 10 years), and generally consume way more foreign media. They’d be more focused about lists for quality (side note: https://www.icheckmovies.com/lists/icheckmovies+-+most+favorite/ is an excellent list for those of us who do care about quality) and less about movies society can agree to talk about over the water cooler. Gwern wrote a fairly convincing case about this.


    And the Academy awards don’t sort movies *that* well. After all, Oliver! won the same year that 2001: A Space Odyssey came out.

    • Ronfar

      And plenty of people still hate 2001: A Space Odyssey even today.

    • Jared

      Lets apply that argument to sports. For the most part, sports don’t really change that much. People are being inefficient by watching new sports so they should just watch recordings of a few great games. If anything, this should be more convincing than watching old movies because movies can conceivably be about a new subject. Football will probably be the same in 20 years.

      Now try arguing this point and see how many people will be convinced that watching new games is “inefficient” and will cease to do so.

      • IMASBA

        It doesn’t work for sports because an important part of watching sports is not knowing the outcome. New matches are necessary to satisfy that condition.

      • GMU Water Cooler Talk

        You don’t watch sports for the quality of the pure entertainment you are given. Competition depends on context so much more than content (don’t ask me to explain the success of “Let’s Play!” Youtube videos because I don’t have a very convincing explanation other than “people like community and solitary gaming alone doesn’t give you that”). Very few take recordings of sports games in a “desert island” scenario.

  • http://juridicalcoherence.blogspot.com/ Stephen Diamond

    Katja Grace suggested one plausible theory to me: we hope or expect to get a better price on things with good potential, relative to good achievement.

    As it is stated, I don’t see how this explains anything: we’d expect the price to be discounted by the lower correlation.

    But Katja’s idea does combine well with yours. Insofar as we’re involved in status competition about predicting fashions and trends, we are likely to manifest a self-enhancing bias, overestimating our own skill at prediction.

  • ScottH3

    Which person would you rather be: the one with a lot of achievements, or the one with all the potential in the world?

    Is this an example? College wunderkind or Successful executive? Isn’t there something lost even when potential is realized?

  • robertwib

    It’s fun to talk about what movie you think should win, or should have won, but that conversation runs out of steam quickly after the Oscars are over. If you want to participate you need to form opinions to share ahead of the event.

    • http://overcomingbias.com RobinHanson

      And I’m suggesting that this same motive drives a lot more of our behavior than we realize.

  • asdf

    Wanting is not the same as liking. When we get/achieve something we thought we wanted, it can be less exciting than the anticipation of getting that thing.

    Hypothetically, if there were a startup with fewer users but more potential, that might be more exciting than a startup that’s already achieved something and has the potential to grow more (but perhaps seems to have less potential than the new startup).

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  • Lord

    There is also a desire for novelty and variety somewhat distinct from fashion. Accomplishment can become boring and tired. How many want to watch the same movie or eat the same dinner over and over?

    • Jason Young

      I agree that the desire for novelty and variety is distinct from the desire to be fashionable, but what is fashionable depends on how novel a thing seems within its category to those who typically pay attention to that category.

  • stevesailer

    They should move the Oscars up two weeks in February to the Sunday after Super Bowl Sunday, or even the Sunday before Super Bowl Sunday. By late February (or even March in Olympics years) last year’s movies are stale.

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  • http://www.truthcoin.info/ psztorc

    The Potentials give us an opportunity -psychologically- to steal their triumph! Post-potentials remind us that we are losers, or mediocrities.

    The puzzle you’ve laid out is “choose people described as” in two cases: Potential and post-Potential. What is the difference, bias wise?

    As we know, everyone is the hero of their own story. Watching someone else succeed is like saying “You aren’t needed at all, in fact you missed a big opportunity, loser!”, however, noticing someone with ”’potential”’ means that they still lack something (even it is just a small amount of time), and you -yes, you!- can provide that thing, you can provide that magical encouragement or association because you are what Mr(s). Potential *really* needed. “I am a part of this now…this amazing destiny prepared uniquely for me!”.

    I observed this many times: myself, or friends, would get accepted to a new prestigious school or job, and everyone would start giving ‘advice’ or favors. Yes, they wanted in on the ground floor, favor-wise or association-wise (the investment theory we’ve already discussed, “You know that famous Mr. X….I served him coffee!”), but they also wanted to *share credit* (“I know that, without my coffee, Mr. X would never have succeeded. The universe is so lucky to have me!”).

    Post-potentials mean that -no- the universe doesn’t need you for *anything*.

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  • JW Ogden

    I wonder if this helps to explain the low volatility premium in stock (if it really exists), Take that old stogy unfashionable steadily growing divided stock over the next thing because people have bid the fastionable stocks up too high.