Self-deceived individuals are better at deceiving others.

Abstract

Self-deception is widespread in humans even though it can lead to disastrous consequences such as airplane crashes and financial meltdowns. Why is this potentially harmful trait so common? A controversial theory proposes that self-deception evolved to facilitate the deception of others. We test this hypothesis in the real world and find support for it: Overconfident individuals are overrated by observers and underconfident individuals are judged by observers to be worse than they actually are. Our findings suggest that people may not always reward the more accomplished individual but rather the more self-deceived. Moreover, if overconfident individuals are more likely to be risk-prone then by promoting them we may be creating institutions, including banks and armies, which are more vulnerable to risk. Our results reveal practical solutions for assessing individuals that circumvent the influence of self-deception and can be implemented in a range of organizations including educational institutions.