Daniel Kahneman
👤 PersonAppearances Over Time
Podcast Appearances
And so you expect that any underwriter, that it doesn't matter which underwriter you get for the premium.
And the company has that expectation.
It shouldn't make much difference.
So we tested that.
And they constructed some cases.
And then we had some, like, 50 underwriters assess a premium for the case.
Yeah, with a really very realistic.
We didn't construct it.
They constructed the case.
And they conducted the experiment.
But now, the interesting question is,
How much variation do you expect there to be?
So we asked the executives the following question.
Suppose you take two underwriters at random.
By what percentage do they differ?
I mean, you look at the difference between their premium, divide that by the average premium.
What number do you get?
And people expect 10%.
By the way, it's not only the executives in that company.
For some reason, people expect 10%.