Comment by benjaminhaley on 16 types of useful predictions · 2015-04-10T22:53:32.050Z · LW · GW

I've established a habit of putting my money where my mouth is to encourage myself to make more firm predictions. When I am talking with someone and we disagree, I ask if they want to bet a dollar on it. For example, I say, "Roger Ebert directed Beyond the Valley of the Dolls". My wife says, "No, he wrote it.". Then I offer to bet. We look up the answer, and I give her a dollar.

This is a good habit for many reasons.

1. It is fun to bet. Fun to win. And (kinda) fun to lose.
2. It forces people to evaluate honestly. The same people that say "I'm sure..." will back off their point when asked to bet a dollar on the outcome.
3. It forces people to negotiate to concrete terms. For example, I told a friend that a 747 burns 30,000 lbs of fuel an hour. He said no way. We finally settled on the bet "Ben thinks that a fully loaded 747 will burn more than 10,000 lbs of fuel per hour under standard cruising conditions". (I won that bet, it burns ~25,000 lbs of fuel/hour under these conditions).
4. A dollar feels more important than it actually is, so people treat the bets seriously even though they are not very serious. For this reason, I think it is important to actually exchange a dollar bill at the end, rather than treating it as just an abstract dollar.

I've learned a lot from this habit.

1. I'm right more often than not (~75%). But I'm wrong a lot too (~25%). This is more wrong than I feel. I feel 95% confident. I shouldn't be so confident.
2. The person proposing the bet is usually right. My wife has gotten in the habit too. If I propose we bet, I'm usually right. If she proposes we bet I've learned to usually back down.
3. People frequently overstate their confidence. I mentioned this above, but it bears repeating. Some people regularly will use phrases like "I am sure" or say something emphatically. People are calibrated to express their beliefs differently. But when you ask them to bet a dollar you get a more consistent calibration. People that are over-confident often back away from their positions. Really interesting considering that its only a dollar on the line.
4. Over time people learn to calibrate better. At first my wife would agree to nearly every bet I proposed. Now she usually doesn't want to. When she agrees to a bet now, I get worried.