Self-deception is widespread in humans even though it can lead to disastrous consequences such as airplane crashes and financial meltdowns. Why is this potentially harmful trait so common? A controversial theory proposes that self-deception evolved to facilitate the deception of others. We test this hypothesis in the real world and find support for it: Overconfident individuals are overrated by observers and underconfident individuals are judged by observers to be worse than they actually are. Our findings suggest that people may not always reward the more accomplished individual but rather the more self-deceived. Moreover, if overconfident individuals are more likely to be risk-prone then by promoting them we may be creating institutions, including banks and armies, which are more vulnerable to risk. Our results reveal practical solutions for assessing individuals that circumvent the influence of self-deception and can be implemented in a range of organizations including educational institutions.

Introduction

Self-deception - individuals' false beliefs about their abilities – is widespread in humans. People consistently overrate their capabilities [1], [2], suffer from positive illusions [3] and deny their disabilities [4]. We are remarkably prone to both overconfidence - reflecting inflated beliefs about our abilities - and underconfidence arising from a negative self-image [5]–[7]. These biased beliefs can lead to costly errors with disastrous consequences including airplane crashes, financial meltdowns and war [5], [6], [8], [9]. Why is this potentially harmful trait so common? A controversial theory proposes that self-deception has evolved to facilitate the deception of others [5], [6], [8], [10]. Self-deceived individuals may be less likely to produce cues, such as stress, that reveal deception [5]. Here, we provide the first direct test of this hypothesis in a real-world setting and find support for it. We demonstrate that individuals who overestimate their abilities at a task are overrated at that task by observers. Equally, individuals who falsely believe that they are not good at the task are judged by observers to be worse at it than they actually are. Our findings suggest that people may not always reward the more accomplished individual but rather the more self-deceived. Moreover, if overconfident individuals are more likely to be risk-prone [11] then by promoting such individuals we may be creating institutions, including banks, trading floors, emergency services and armies, that are also more vulnerable to risk.

Many authors argue that the intra-personal gains of positive self-deception provide an adequate account for its prevalence [3], [12]. For example, positive beliefs about oneself are associated with increased well-being and enhanced status [3], [13], [14]. Overconfidence may also be advantageous when competitors are uncertain about their relative abilities [15]. An alternative theory suggests that self-deception first evolved in the context of inter-personal relations because it facilitates the deception of others by eliminating cues that reveal deception [5], [6], [8], [10]. According to this view, the intrapersonal advantages of self-deception are a by-product rather than the driving force for the evolution of this trait. While this idea has theoretical traction [16], it remains empirically untested. We present the first direct evidence suggesting that fooling oneself helps fool others.

Our study was conducted within the context of the tutorial system implemented at some universities, where students meet in small groups on a weekly basis to review, debate and discuss course material with a tutor and each other. In these tutorials, students interact freely with each other and the tutor. At the end of the first tutorials for a first-year undergraduate course held in the first term, students were asked to privately predict the performance of each of their peers from the tutorial group; they were asked to predict the absolute grade and relative rank they thought each of their classmates would obtain for the next assignment that they would complete for the course. Similarly, they assessed their own performance. Participants received one British pound for each correct prediction that they made. 71 out of 73 participants did not know anyone in their tutorial group prior to enrolling at university only 3 weeks before the first tutorial was held. They were thus limited to basing their predictions solely on their interactions in a single tutorial. We later obtained participants' actual grades from the lecturer for the course. All assignments were marked double-blind, i.e. the lecturer did not know the identity of the students while grading them.

We measure self-deception as the difference between the self-estimate and the actual grade of an individual. We measure deception as the difference between the median estimate made by peers and the actual grade of an individual. We measure the susceptibility to being deceived as the median of the difference between the grades that an individual predicted for peers and the actual grades that those peers received from the tutor. Table 1 provides a summary of these behavioural measures and how they are calculated.

If self-deception facilitates deception then we expect the measures of self-deception and deception to be positively associated with each other. Concurrently, if self-deception diminishes individuals' ability to detect deception by others then we expect our measure of self-deception to be positively associated with the susceptibility to being deceived.

The study was run at two universities in London, University College London and Queen Mary University of London, and the average number of students in each tutorial group was about 8. Table 2 presents summary statistics for the tutorial groups included in our study and Table 3 provides a demographic description of our study sample. The study was run two times, once at the end of the first tutorial and a second time at the end of a tutorial about six weeks later to test whether the association between self-deception and deception weakened with extended interaction between participants.