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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.