Algorithm Aversion – Why People Don’t Follow The Model!

0
Algorithm Aversion – Why People Don’t Follow The Model!
Source: “Algorithm Aversion: People Erroneously Avoid Algorithms After Seeing Them Err” by Dietvorst et al. (2014)

Algorithm Aversion – Why People Don’t Follow The Model! by Jack Vogel, Ph.D., Alpha Architect

There are many studies showing that models beat experts, including the meta-study “Clinical versus mechanical prediction: A meta-analysis” by Grove et al. (2000).

However, given this knowledge that models beat experts, forecasters still prefer to use the human (expert) prediction as opposed to using the model.

Why is this?

Bonhoeffer Fund July 2022 Performance Update

Screenshot 27Bonhoeffer Fund's performance update for the month ended July 31, 2022. Q2 2022 hedge fund letters, conferences and more The Bonhoeffer Fund returned 3.5% net of fees in July, for a year-to-date return of -15.8%.   Bonhoeffer Fund, LP, is a value-oriented private investment partnership for . . . SORRY! This content is exclusively for Read More

A recent paper by Die