Objective: Understand the institutional definitions and applications of prediction bias, decision bias, and action bias.
INSTITUTIONAL ANALYSIS
● Prediction bias (sesgo de predicción) is the consideration of only a limited range of potential outcomes.
● An example of prediction bias is the disregard of important risks when evaluating future events 🌍.
● Prediction bias is also the overconfidence in personal abilities when projecting scenarios.
● Decision bias (sesgo de decisión) is the restriction of options when choosing among alternatives.
● An example of decision bias is the rapid choice that ignores relevant information 📊.
● Decision bias is also the guidance of decisions by emotional motivations instead of rational assessment.
● Action bias (sesgo de acción) is the limitation of possible actions in a situation.
● An example of action bias is the belief that value arises only through direct execution 📌.
● Action bias is also the overestimation of the effectiveness of chosen actions.
INSTITUTIONAL DEFINITIONS
● Prediction bias (sesgo de predicción) is defined as the cognitive distortion that narrows expected outcomes.
● This bias appears when individuals or institutions underestimate relevant risks in strategic contexts 📚.
● Decision bias (sesgo de decisión) is defined as the tendency to reduce the evaluation of alternatives.
● This bias appears when decisions are made quickly and disregard adequate information 🔎.
● Action bias (sesgo de acción) is defined as the distortion that attributes value only to active responses.
● This bias appears when organizations assume their choices are more effective than evidence indicates 🏛️.
● Prediction bias, decision bias, and action bias are connected because each restricts cognitive evaluation.
● The three biases contrast in focus: prediction bias limits outcomes, decision bias limits choices, and action bias limits actions.
● Institutional awareness of these biases allows explicit recognition of their practical consequences.
My Diary - Leonardo Cardillo 