American Economic Journal:
Microeconomics
ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)
Underestimating Learning by Doing
American Economic Journal: Microeconomics
(pp. 328–51)
Abstract
Many economic decisions, such as whether to invest in developing new skills, change professions, or purchase a technology, benefit from accurate estimation of skill acquisition. We examine the accuracy of such predictions by having study participants predict the speed at which they will master unfamiliar tasks. Across three studies involving two types of tasks and two levels of difficulty, we find systematic underestimation of learning, even after receiving feedback. In a fourth study, participants predicting others' performance showed significantly less underestimation, suggesting that projection bias—overreliance on immediate perceptions of effort and difficulty—may drive prediction errors.Citation
Horn, Samantha, and George Loewenstein. 2025. "Underestimating Learning by Doing." American Economic Journal: Microeconomics 17 (4): 328–51. DOI: 10.1257/mic.20240141Additional Materials
JEL Classification
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- J24 Human Capital; Skills; Occupational Choice; Labor Productivity