April 12, 2016

The Quinton

Bold Predictions and Confirmation Bias

by Jeff Quinton

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The Baseball Prospectus Fantasy team, me included, will be rolling out (bold) predictions this week (and maybe next week). The esteemed and excellently named Wilson Karaman already released his bold predictions here. You love bold predictions, I love bold predictions, we all love bold predictions. There are a lot of reasons we like bold predictions. Per my best estimates, the main reasons we like bold predictions are as follows: (i) they are easy to digest (instead of the slog that is an article on, say, confirmation bias), (ii) they offer analysis and insight that is often a break from the consensus, and (iii) they can confirm our past decisions or current beliefs and if they do not, then they can easily be ignored.

Over here at The Quinton, we cannot let stand people finding happiness in things. It just wouldn’t be right. That said, while the first two reasons for liking bold predictions are, on their own, harmless, the last reason can be problematic in regards to our future decision making. We might not want to admit it, but the way we read bold predictions articles is to quickly scan through for anything that makes us feel good, for anything that confirms what we believe or want to believe. The person writing the article thinks the player I reached for is going to be awesome? Awesome, now I do not feel as bad about the decision I made. The person writing the article thinks the player I passed on even though it was a great price is going to be bad? Awesome, now I feel better about the decision I made.

Confirmations bias’s fingerprints are all over this. Per google, confirmation bias is “a tendency to search for or interpret information in a way that confirms one's preconceptions.” We have discussed confirmation bias previously, but the adverse effects in this case should be noted. First, focusing on predictions regarding our own players is going to cause inconsistencies in our valuation process. At this point of the season, we might ask “so what?” The reason this matters is because it likely causes us to make suboptimal decisions whether in trade talks or in free agency. How so? It seems likely that our search for and finding of confirming information exacerbates another one of our enemies in decision making, that being the endowment effect. If you’ve been reading along, you know that the endowment effect causes to overrate the things we own/possess/consider to be our own. This phenomenon already exists outside of the confirmation bias, so when we add in paying extra attention toward viewing our players more favorably, it maybe sheds some light as to why many fantasy baseball participants are hesitant to participate in trades and/or drop players that they should.

So should we avoid bold predictions all together? I do not think so. For starters, the authors of these pieces are not trying to bias the reader in any way; they are trying to provide insight. The main goal, we would hope, is to try and shed some light on an outcome in which there is reason to believe that the industry is misjudging the probability of a particular outcome. That, finding cracks in the consensus valuation, is valuable. The tough part, then, is figuring out how to consume this helpful analysis without adding additional bias to our process.

The solution that works best for me is in being diligent in my process of consuming fantasy baseball analysis. This means a few things. First, if we are going to read articles on our players, we should make a point of it to read those same articles on other players—whether or not they are relevant to any of our past, current, or future decisions. Secondly, we should try to apply the insights provided by these analyses to players other than the subject or subjects in the analyses. For example, if an author is writing about how a pitcher might be due for improvement because of an improved walk rate in the second half of the previous season, we should then see what other pitchers this applies to before changing our valuation on just that individual player. Lastly, as always, we need to be aware of how these biases affect us. It is fun to read about our players and we deserve some fun once in a while. But knowing all this, we should strive to enjoy without falling in love with or attempting to justify our own decisions. We will never get all the way there, but if we can be a little more disciplined than our competition, we will enjoy that much of an advantage.

Jeff Quinton is an author of Baseball Prospectus. Follow @jjq01
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