Illusory truth

I’ve been using snopes.com to fact check dubious stories since before fake news was a term. I still recommend it to everyone.

I also teach elements of critical thinking in some of the actuarial normative skills workshops I run. By the time students get to me there, they are often already pessimistic and cynical when it comes to core areas of work (to be clear, this is a criticism of the profession, with a silver lining of critical thinking). However, there are plenty of other areas where their minds still seem susceptible to fakenews.

This re-energised my interest in this area. I’ll blog on this topic more in future. One area I discovered in my research is the Illusory Truth Effective.

The Illusory Truth Effect is a really disappointing insight into how poorly our brains do at identifying truth. At its core, it says that when subjects are exposed to facts multiple times, even if the facts are highlighted as being false, still increases the probability that those subjects will view the facts as true. So whether it is on a Sunday morning surrounded by friends and family, or on the couch on your own infinitely browsing social media, what you see and hear and read becomes true in some proportion of minds.

It also applies to election campaigns and political rhetoric.

I’m going to test this with my actuarial students next chance I get.

Published by David Kirk

David Kirk runs Milliman’s actuarial consulting practice in Africa. He is an actuary and is the creator of New Business Margin on Revenue. He specialises in risk and capital management, regulatory change and insurance strategy . He also has extensive experience in embedded value reporting, insurance-related IFRS and share option valuation. He has been involved in significant insurance projects across Sub Saharan Africa and in the Middle East.

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