Hindsight Bias: The Role of Perfect Memory and Meta-Cognitions

The hindsight bias is the tendency of people to falsely believe that they would have predicted the outcome of an event correctly, once the outcome is known. The present paper addresses the ongoing debate whether the hindsight bias is due to memory impairment or biased reconstruction. The memory impairment approach states that outcome information alters the memory trace for the initial judgement, whereas the biased reconstruction approach assumes that people who have forgotten their initial judgements are forced to guess and, in the presence of outcome information, are likely to use this information as an anchor. Three experiments will be presented which show that the biased reconstruction explanation provides a better explanation for empirical findings in hindsight bias research than the memory impairment explanation. In experiment 1, contrary to the predictions of the memory impairment view, outcome information did not affect the number of correct recalls (hit rate) in the experimental conditions (with outcome information). In experiment 2 the biased reconstruction approach offers a very parsimonious explanation of stronger hindsight bias in the hypothetical design than in the memory design. In experiment 3, again in line with the bias reconstruction approach, experimentally induced assumptions about how close to or distant from the outcome information the initial judgements had been, moderated the magnitude of the hindsight bias. Participants who were made to believe that their initial judgement had been close to the actual outcome showed a stronger hindsight bias. According to the memory impairment view such meta-cognitive considerations should play no relevant role.