In this episode of Choiceology with Katy Milkman, we look at the often-misunderstood and surprisingly common Dunning-Kruger effect with an interview featuring one of the researchers who first identified it, David Dunning.

But we start with the story of Cecilia Jimenez, the humble Spanish grandmother and amateur landscape painter who took it upon herself to restore a fresco in her local church. The results made international headlines—and briefly made Ceclia Jimenez a household name—for all the wrong reasons.

Andrew Flack has a lot of compassion for Cecilia. He met with her several times in the process of writing an opera with composer Paul Fowler called Behold the Man about Ceclia’s ill-fated but ultimately beneficial project.

Next, David Dunning explains how—contrary to popular belief—we are all at the mercy of the Dunning-Kruger effect from time to time, and that we should be more humble in recognizing what we don’t know about what we don’t know.

David Dunning is the Ann and Charles R. Walgreen, Jr., Professor of the Study of Human Understanding at the University of Michigan. The paper "Unskilled and Unaware of It: How Difficulties in Recognizing One's Own Incompetence Lead to Inflated Self-Assessments," co-authored with Justin Kruger, led to the bias being named The Dunning-Kruger effect.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All expressions of opinion are subject to change without notice in reaction to shifting market conditions.

All names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting From Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

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Pursuing a goal alone is convenient. Whether you're training for a marathon or aiming to read 20 books this year, it's convenient to move at your own pace and schedule. But having a gym buddy or a book club pal can make a bigger difference to your goal completion than you think.

In this episode of Choiceology with Katy Milkman, we look at the benefits of tandem goal pursuit in the context of training for a new Olympic sport: kite foiling.

Max Maeder is a 17-year-old kite foiling athlete and many-time world champion of the sport. Max is also a recent Olympic bronze medalist, having just represented Singapore at the 2024 Paris Games and winning the country's lone medal. To get to this point, Max has been working with the same training partner since 2021. And in this solo sport, working with a partner has made all the difference.

Next, Katy speaks with Rachel Gershon about their research on tandem goal pursuit and the many benefits of working toward goals with a partner. You can learn more in their working paper titled "Friends With Health Benefits: A Field Experiment."

Rachel Gershon is an assistant professor of marketing at the Haas School of Business at the University of California, Berkeley. Her research focuses on consumer judgments and choice with an emphasis on social, prosocial, and health-related behaviors.

Special thanks to Cam Farrar for use of his TikTok audio and the International Kiteboarding Association for use of their audio. You can find kite-foiling videos on the IKA's YouTube channel @kiteclasses.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting From Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

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When you're facing loss—say, in a board game or during a sporting event or with a declining stock—it can be difficult to remember your true tolerance for risk. You're likely to seek risk more than you normally would.

In this episode of Choiceology with Katy Milkman, we look at a tendency to seek risk in the face of losses when those losses aren't yet finalized, but how chalking up those losses and moving on can actually help you recalibrate your appetite for risk.

During the American Revolutionary War, George Washington and his generals often adopted a strategy of retreating, or accepting losses on the battlefield, in order to regroup and live to fight another day. Their strategy was often successful against the British, who burned through men and equipment as they doubled down in their desire to win individual battles at the expense of their goal of regaining control of the American colonies.

Mary Stockwell is a historian, writer, and former history professor at Lourdes University in Ohio. Her work is focused on the American Revolution. Her recent book is titled Unlikely General: "Mad" Anthony Wayne and the Battle for America.

Next, Katy speaks with Alex Imas about his research on risk-taking over time and how mental choice bracketing impacts our decisions in the face of loss. You can learn more in Alex's paper titled "The Realization Effect: Risk-Taking after Realized Versus Paper Losses."

Alex Imas is a professor of behavioral science and economics at the University of Chicago Booth School of Business.

Choiceology is an original podcast from Charles Schwab.

If you enjoy the show, please leave a rating or review on Apple Podcasts.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request.

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting from Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

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