David Freedman, in his outstanding book Wrong, shows that experts are often the reason we get into big messes, whether the field is medicine, investing, science, psychology, raising children, dieting or business management. With often frightening examples, he exposes the biases and career pressures that often lead to dangerously distorted ways in which experts arrive at their advice. Since much of the book is devoted to the field of medicine, it can be a frightening read, leaving you uncertain about what and who to believe.
Freedman explains how biases and corruption play a role in expert recommendations. He explains: "Most of us think of scientists as being devoted to uncovering truths, not pumping their career prospects. Less formal experts don't enjoy that sort of halo. To win promotion or even simply keep their jobs, law-enforcement officials have to wrestle with the sometimes vicious politics racking the administrations they serve and stockbrokers desperately struggle to corral new customers lest they not survive the next round of pink slips. For such experts, actually being right isn't always the best path to career success. There have been endless accounts of doctors ginning up unnecessary or overpriced tests for patients carried out at labs in which the doctors are investors, of government officials who receive favors and kickbacks, or brokers churning accounts to raise commissions and so forth."
Freedman notes that a wide range of economists and even mathematicians, as well as many nonscientist financial experts, have been demonstrating quite clearly for about a century that no matter what technique you use to pick stocks you're not likely to beat the market. This happens despite the fact that "many of us still put our faith in, not to mention bet our life savings based on, the advice of, say a screaming, bouncing, bell-ringing television personality who claims to have special insight into the movements of stocks, is, I think, a sharp illustration of how some experts can ride straight-out irrationality to great personal success."
The book offers excellent insights into why listening to experts should always be accompanied with due diligence. If you've wondered how experts can be wrong so often, this book is a must read for you.
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