Experts’ ability to predict the future fosters unwarranted optimistic expectations.
Massimiliano Ostinelli & Andrea Bonezzi
What the paper says
We show that merely knowing that experts can predict future events with higher (vs. lower) accuracy can bias consumers' expectations about the outcomes of such events. We focus our investigation on predictions of assets' value and show that the mere belief that experts can predict the future value of a stock with higher (vs. lower) accuracy leads people to form unfounded optimistic expectations about the future value of the stock and invest more in that stock, even if experts' predictions remain undisclosed. Drawing on the concept of the community of knowledge, we suggest that this bias originates from a sense of empowerment that reduces the perceived likelihood of adverse outcomes. The phenomenon we uncover is important as unfounded expectations about an asset's value may lull consumers into making unwarranted investments, potentially harming personal finances and social welfare. (PsycInfo Database Record (c) 2026 APA, all rights reserved).
Evidence weight
Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40
| F · citation impact | 0.50 × 0.4 = 0.20 |
| M · momentum | 0.50 × 0.15 = 0.07 |
| V · venue signal | 0.50 × 0.05 = 0.03 |
| R · text relevance † | 0.50 × 0.4 = 0.20 |
† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.