The tendency to base our judgments on the accessibility of social constructs can lead to still other errors in judgment. One such error is known as the false consensus bias, the tendency to overestimate the extent to which other people hold similar views to our own. As our own beliefs are highly accessible to us, we tend to rely on them too heavily when asked to predict those of others. For instance, if you are in favor of abortion rights and opposed to capital punishment, then you are likely to think that most other people share these beliefs (Ross, Greene, & House, 1977). In one demonstration of the false consensus bias, Joachim Krueger and his colleagues (Krueger & Clement, 1994) gave their research participants, who were college students, a personality test. Then they asked the same participants to estimate the percentage of other students in their school who would have answered the questions the same way that they did. The students who agreed with the items often thought that others would agree with them too, whereas the students who disagreed typically believed that others would also disagree. A closely related bias to the false consensus effect is the projection bias, which is the tendency to assume that others share our cognitive and affective states (Hsee, Hastie, & Chen, 2008).
In regards to our chapter case study, the false consensus effect has also been implicated in the potential causes of the 2008 financial collapse. Considering investor behavior within its social context, an important part of sound decision making is the ability to predict other investors’ intentions and behaviors, as this will help to foresee potential market trends. In this context, Egan, Merkle, and Weber (in press) outline how the false consensus effect can lead investors to overestimate the extent to which other investors share their judgments about the likely trends, which can in turn lead them to make inaccurate predictions of their behavior, with dire economic consequences.
Although it is commonly observed, the false consensus bias does not occur on all dimensions. Specifically, the false consensus bias is not usually observed on judgments of positive personal traits that we highly value as important. People (falsely, of course) report that they have better personalities (e.g., a better sense of humor), that they engage in better behaviors (e.g., they are more likely to wear seatbelts), and that they have brighter futures than almost everyone else (Chambers, 2008). These results suggest that although in most cases we assume that we are similar to others, in cases of valued personal characteristics the goals of self-concern lead us to see ourselves more positively than we see the average person. There are some important cultural differences here, though, with members of collectivist cultures typically showing less of this type of self-enhancing bias, than those from individualistic cultures (Heine, Lehman, Markus, & Kitayama, 1999).