The Gambler's Fallacy (Clustering Illusion)
by Jim Davis
Can you be "good" at picking heads or tails?
As a football player I was honored to Captain my team alongside a handful of incredible leaders. One of them was, in his own estimation, inherently good at the coin toss. He had an uncanny intuition into whether the referee’s quarter would land heads or tails. Or so he thought.
Another friend of mine believes himself to be one of the world’s elite slot machine players. He knows this because he recently went on a streak of wins that netted him about three hundred dollars… a bucket full of quarters.
They have each fallen victim to a phenomenon called the “clustering illusion”. The clustering illusion, sometimes referred to as the gambler’s fallacy, occurs when a cluster of random results is falsely imbued with meaning. It’s a common mistake.
The football captain who guessed the coin toss correctly for the past four games might falsely assume that he has a knack for the task. Of course, he had a 50/50 chance of being correct and, no matter how many times the coin has landed in his favor, his next guess will always be subject to those very same odds.
Similarly, the slot machine player is at the randomized mercy of the machine. In fact, the success of the slot machine industry is reliant on the clustering illusion – it is good for business if a player believes they are somehow “good” at pulling a lever, and that the results are anything but random.
Do you know someone who thinks they're "good" at something with random results? A coin flip? Roulette? They might be falling victim to the gambler's fallacy, aka the 'clustering illusion' - if they're not careful, it can impact other areas of their life.
Pattern-Seeking
The brain is thirsty for patterns. Floating meaninglessly through a chaotic universe (or workplace) can be a discomforting feeling. Consciously and subconsciously, people look for patterns, some method to the madness.
Cornell psychologist Tom Gilovich is a household name in the world of decision-making and psychological bias. One of his most famous encapsulations of the clustering illusion refers to a map printed in a London newspaper during World War II.
Based on the image below, it looks as though the quadrants near the city (bottom right corner) and near Regent’s Park (top left) experienced the heaviest bombing. Assumptions were made based on this evidence. Perhaps the German bombing technologies had advanced in their precision, and they were targeting specific areas. Or perhaps they were steering clear of other area (like the top right quadrant) due to some nefarious plan – perhaps there were German spies or allies in that vicinity.
The truth, however, is that the vertical and horizontal lines created quadrants which made the reader notice artificial clusters. When the quadrants were drawn diagonally, the randomness of the strikes was more clear:
It was less about where the bombs were dropped and more about how the lines had been drawn. How we label our environment matters.
Keep Your Eyes Peeled (and mind your tongues and hearts)
Even the most aware among us can fall victim to the clustering illusion. In fact, the more vigilant we are, the more likely we are to find one (if we're not careful).
When sifting through complex patterns, pay close attention to Language and Emotion. If a cluster of outcomes appear from a set of random occurrences, it might be because we are unintentionally predisposing ourselves to find it.
Devout Christians might see the face of the Madonna in a piece of toast. To the junior high student who claims their teacher has it out for them, every instruction feels like an insult. The fearful Londoner will seek to make sense of the terror around them.
The football captain using language like “good” in reference to coin flip skills has already biased his result. If he guesses correctly, he might say “see, I did it again!” but if he is wrong, he might say “that ref didn’t flip it high enough” (this comes from a real-life example).
The language we use before we experience a situation can bias our experience of that situation, and the story we tell to explain it.
Noticing a potential pattern is good. But the captain making assumptions about a cluster of coin flips would be mistaken. The quarter is not rigged. His talent has not been proven. And there is no change in the likelihood of what the next flip will be – after five consecutive tails, the odds of tails popping up on the next flip is still exactly 50/50. Talent is not a factor.
Our logical minds understand this. Emotion changes things.
The football captain was hyped up before every game. He loved football. The slot-machine player was as excited about playing as he was about winning. The student is self-conscious, the Christian is faithful, and residents of a bombed city are understandably afraid. Emotion can bias perception toward the noticing of artificial clusters. In each of these cases, someone used language to frame situations rich with emotion, then fell victim to the clustering illusion.
Emotions are a magnificent guide. They point us in the right direction. But emotions are often blunt tools when it comes to more finely tuned thinking. We have to pay close attention.
Interesting. But Why Does it Matter?
If we label ourselves as good at the coin toss, we will be magnets for correct guesses. We will find them. If one is labeled as good at the slot machine, every jackpot becomes proof. Misleading findings can be innocuous, or they change the way one experiences the world.
If you routinely call your neighbor a jerk, then every time he lets his lawn grow too long, you will see confirmation. If one labels their romantic partner a slob, then every wayward spoon or dirty dish is another log on that fire. Behaviors will be artificially clustered by emotion and language.
Worse still, what if a police officer labeled people of a certain race as “criminals”. Would that not influence routine interactions? How about a teacher labeling a certain gender as good or bad at math? Research shows that even teachers, who have committed their lives to educating young people, fall victim to these biases, (Copur-Genturk et al, 2019).
That boss you label a jerk will eventually say or do something that confirms this bias. Three curt emails over the course of the week could be clustered together and “prove” what you have been saying all along. You might be right. But you might have missed the dozens of thoughtful, encouraging emails he sent as well. You might have been a magnet for a common occurrence, then grouped those curt emails into a cluster of proof. “See, I told you he was a jerk.”
Let’s catch ourselves doing this.
The remedy always begins with self-awareness. Educating oneself, then taking the time to be thoughtful and aware in any given moment. Don’t make decisions based on knee-jerk reactions, if you can help it.
Take a moment to examine the language and emotion embedded in a situation. Be honest with yourself. Did you unintentionally bias the likelihood that a pattern might appear? When you notice a cluster, take the time to look once more.
Tell a humble story. Dig a little deeper. Make this the norm. Like any other leadership skill, it might take time, but it will definitely be worth it.
James (Jim) Davis works with teams and individuals on leadership development, culture enhancement, and performance psychology. He studied Human Development and Psychology at Harvard University and is a sought-after speaker, author, and coach. In 2020 he received US Marine Corps' 'Excellence in Leadership Award'. To work with Jim, CLICK HERE.