Is Military Incompetence Adaptive?

Which return regime induces overconfidence behavior? Artificial intelligence and a nonlinear approach

Overconfidence behavior, one form of positive illusion, has drawn considerable attention throughout history because it is viewed as the main reason for many crises. Investors' overconfidence, which can be observed as overtrading following positive returns, may lead to inefficiencies in stock markets. To the best of our knowledge, this is the first study to examine the presence of investor overconfidence by employing an artificial intelligence technique and a nonlinear approach to impulse responses to analyze the impact of different return regimes on the overconfidence attitude. We examine whether investors in an emerging stock market (Borsa Istanbul) exhibit overconfidence behavior using a feed-forward, neural network, nonlinear Granger causality test and nonlinear impulse-response functions based on local projections. These are the first applications in the relevant literature due to the novelty of these models in forecasting high-dimensional, multivariate time series. The results obtained from distinguishing between the different market regimes to analyze the responses of trading volume to return shocks contradict those in the literature, which is the key contribution of the study. The empirical findings imply that overconfidence behavior exhibits asymmetries in different return regimes and is persistent during the 20-day forecasting horizon. Overconfidence is more persistent in the low- than in the high-return regime. In the negative interest-rate period, a high-return regime induces overconfidence behavior, whereas in the positive interest-rate period, a low-return regime induces overconfidence behavior. Based on the empirical findings, investors should be aware that portfolio gains may result in losses depending on aggressive and excessive trading strategies, particularly in low-return regimes.

May God Guide Our Guns : Visualizing Supernatural Aid Heightens Team Confidence in a Paintball Battle Simulation

The perceived support of supernatural agents has been historically, ethnographically, and theoretically linked with confidence in engaging in violent intergroup conflict. However, scant experimental investigations of such links have been reported to date, and the extant evidence derives largely from indirect laboratory methods of limited ecological validity. Here, we experimentally tested the hypothesis that perceived supernatural aid would heighten inclinations toward coalitional aggression using a realistic simulated coalitional combat paradigm: competitive team paintball. In a between-subjects design, US paintball players recruited for the study were experimentally primed with thoughts of supernatural support using a guided visualization exercise analogous to prayer, or with a control visualization of a nature scene. The participants then competed in a team paintball battle game modeled after “Capture the Flag.” Immediately before and after the battle, participants completed surveys assessing confidence in their coalitional and personal battle performance. Participants assessed their coalition’s prospects of victory and performance more positively after visualizing supernatural aid. Participants primed with supernatural support also reported inflated assessments of their own performance. Importantly, however, covarying increases in assessments of their overall coalition’s performance accounted for the latter effect. This study provided support for the hypothesis that perceived supernatural support can heighten both prospective confidence in coalitional victory and retrospective confidence in the combat performance of one’s team, while highlighting the role of competitive play in evoking the coalitional psychology of intergroup conflict. These results accord with and extend convergent prior findings derived from laboratory paradigms far removed from the experience of combat. Accordingly, the field study approach utilized here shows promise as a method for investigating coalitional battle dynamics in a realistic, experientially immersive manner.

Overconfidence, Incentives and Digit Ratio

This paper contributes to a better understanding of the biological underpinnings of overconfidence by analyzing performance predictions in the Cognitive Reflection Test with and without monetary incentives. In line with the existing literature we find that the participants are too optimistic about their performance on average; incentives lead to higher performance; and males score higher than females on this particular task. The novelty of this paper is an analysis of the relation between participants’ performance prediction accuracy and their second to fourth digit ratio. It has been reported that the digit ratio is a negatively correlated bio-marker of prenatal testosterone exposure. In the un-incentivized treatment, we find that males with low digit ratios, on average, are significantly more overconfident about their performance. In the incentivized treatment, however, we observe that males with low digit ratios, on average, are less overconfident about their performance. These effects are not observed in females. We discuss how these findings fit into the literature on testosterone and decision making and how they might help to explain seemingly opposing evidence.

With God on our side: Religious primes reduce the envisioned physical formidability of a menacing adversary

The imagined support of benevolent supernatural agents attenuates anxiety and risk perception. Here, we extend these findings to judgments of the threat posed by a potentially violent adversary. Conceptual representations of bodily size and strength summarize factors that determine the relative threat posed by foes. The proximity of allies moderates the envisioned physical formidability of adversaries, suggesting that cues of access to supernatural allies will reduce the envisioned physical formidability of a threatening target. Across two studies, subtle cues of both supernatural and earthly social support reduced the envisioned physical formidability of a violent criminal. These manipulations had no effect on the perceived likelihood of encountering non-conflictual physical danger, raising the possibility that imagined supernatural support leads participants to view themselves not as shielded from encountering perilous situations, but as protected should perils arise.

Dead certain: confidence and conservatism predict aggression in simulated international crisis decision-making

Evolutionary psychologists have suggested that confidence and conservatism promoted aggression in our ancestral past, and that this may have been an adaptive strategy given the prevailing costs and benefits of conflict. However, in modern environments, where the costs and benefits of conflict can be very different owing to the involvement of mass armies, sophisticated technology, and remote leadership, evolved tendencies toward high levels of confidence and conservatism may continue to be a contributory cause of aggression despite leading to greater costs and fewer benefits. The purpose of this paper is to test whether confidence and conservatism are indeed associated with greater levels of aggression-in an explicitly political domain. We present the results of an experiment examining people's levels of aggression in response to hypothetical international crises (a hostage crisis, a counter-insurgency campaign, and a coup). Levels of aggression (which range from concession to negotiation to military attack) were significantly predicted by subjects' (1) confidence that their chosen policy would succeed, (2) score on a liberal-conservative scale, (3) political party affiliation, and (4) preference for the use of military force in real-world U.S. policy toward Iraq and Iran. We discuss the possible adaptive and maladaptive implications of confidence and conservatism for the prospects of war and peace in the modern world.

Fortune favours the bold: an agent-based model reveals adaptive advantages of overconfidence in war

Overconfidence has long been considered a cause of war. Like other decision-making biases, overconfidence seems detrimental because it increases the frequency and costs of fighting. However, evolutionary biologists have proposed that overconfidence may also confer adaptive advantages: increasing ambition, resolve, persistence, bluffing opponents, and winning net payoffs from risky opportunities despite occasional failures. We report the results of an agent-based model of inter-state conflict, which allows us to evaluate the performance of different strategies in competition with each other. Counter-intuitively, we find that overconfident states predominate in the population at the expense of unbiased or underconfident states. Overconfident states win because: (1) they are more likely to accumulate resources from frequent attempts at conquest; (2) they are more likely to gang up on weak states, forcing victims to split their defences; and (3) when the decision threshold for attacking requires an overwhelming asymmetry of power, unbiased and underconfident states shirk many conflicts they are actually likely to win. These "adaptive advantages" of overconfidence may, via selection effects, learning, or evolved psychology, have spread and become entrenched among modern states, organizations and decision-makers. This would help to explain the frequent association of overconfidence and war, even if it no longer brings benefits today.

The Face That Launched a Thousand Ships: The Mating-Warring Association in Men

Questions about origins of human warfare continue to generate interesting theories with little empirical evidence. One of the proposed explanations is sexual selection theory. Within and supportive of this theoretical framework, the authors demonstrate a mating—warring association among young heterosexual men in four experiments. Male, but not female, participants exposed to attractive, as compared to unattractive, opposite-sex photographs were significantly more likely to endorse war-supporting statements on a questionnaire. The same mating effect was not found in answering trade conflict questions. Male participants primed by attractive faces or legs of young women were significantly faster in responding to images or words of war than those primed by unattractive faces or national flags. The same mating effect was not found in responding to farming concepts or general aggression expressions. Results underscore the link between mating and war, supporting the view that sexual selection provides an ultimate explanation for the origins of human warfare.

Domains of deception

The von Hippel & Trivers theory of self-deception will gain added traction by identifying psychological design features that come into play in different domains of deception. These include the domains of mating, kinship, coalition formation, status hierarchy negotiation, parenting, friendship, and enmity. Exploring these domains will uncover psychological adaptations and sex-differentiated patterns of self-deception that are logically entailed by their theory.

God would be a costly accident: Supernatural beliefs as adaptive

I take up the challenge of why false beliefs are better than “cautious action policies” (target article, sect. 9) in navigating adaptive problems with asymmetric errors. I then suggest that there are interactions between supernatural beliefs, self-deception, and positive illusions, rendering elements of all such misbeliefs adaptive. Finally, I argue that supernatural beliefs cannot be rejected as adaptive simply because recent experiments are inconclusive. The great costs of religion betray its even greater adaptive benefits – we just have not yet nailed down exactly what they are.

Voice pitch alters mate-choice-relevant perception in hunter-gatherers

In humans, voice pitch is thought to be a cue of underlying quality and an important criterion for mate choice, but data from non-Western cultures have not been provided. Here we test attributions to and preferences for voices with raised and lowered pitch in hunter-gatherers. Using a forced-choice playback experiment, we found that both men and women viewed lower pitched voices in the opposite sex as being better at acquiring resources (e.g. hunting and gathering). While men preferred higher pitched women's voices as marriage partners, women showed no overall preference for voice pitch in men. However, women who were currently breastfeeding had stronger preferences for higher pitched male voices whereas women not currently breastfeeding preferred lower pitched voices. As testosterone is considered a costly signal associated with dominance, heritable immunity to infection and low paternal investment, women's preferences potentially reflect a trade-off between securing good genes and paternal investment. Men's preferences for higher pitched female voices are probably due to an evolved preference for markers of fecundity, reflected in voice pitch.

Overconfidence in wargames: experimental evidence on expectations, aggression, gender and testosterone

Overconfidence has long been noted by historians and political scientists as a major cause of war. However, the origins of such overconfidence, and sources of variation, remain poorly understood. Mounting empirical studies now show that mentally healthy people tend to exhibit psychological biases that encourage optimism, collectively known as 'positive illusions'. Positive illusions are thought to have been adaptive in our evolutionary past because they served to cope with adversity, harden resolve, or bluff opponents. Today, however, positive illusions may contribute to costly conflicts and wars. Testosterone has been proposed as a proximate mediator of positive illusions, given its role in promoting dominance and challenge behaviour, particularly in men. To date, no studies have attempted to link overconfidence, decisions about war, gender, and testosterone. Here we report that, in experimental wargames: (i) people are overconfident about their expectations of success; (ii) those who are more overconfident are more likely to attack; (iii) overconfidence and attacks are more pronounced among males than females; and (iv) testosterone is related to expectations of success, but not within gender, so its influence on overconfidence cannot be distinguished from any other gender specific factor. Overall, these results constitute the first empirical support of recent theoretical work linking overconfidence and war.

The elements of a scientific theory of self-deception

An evolutionary theory of self-deception--the active misrepresentation of reality to the conscious mind--suggests that there may be multiple sources of self-deception in our own species, with important interactions between them. Self-deception (along with internal conflict and fragmentation) may serve to improve deception of others; this may include denial of ongoing deception, self-inflation, ego-biased social theory, false narratives of intention, and a conscious mind that operates via denial and projection to create a self-serving world. Self-deception may also result from internal representations of the voices of significant others, including parents, and may come from internal genetic conflict, the most important for our species arising from differentially imprinted maternal and paternal genes. Selection also favors suppressing negative phenotypic traits. Finally, a positive form of self-deception may serve to orient the organism favorably toward the future. Self-deception can be analyzed in groups and is done so here with special attention to its costs.