Pseudocertainty Effect

The pseudocertainty effect is the belief that humans can fall victim to the belief that an outcome is certain while it is still uncertain. This frequently occurs during multistage decision-making processes (such as those that occur in business projects) where earlier decisions are sometimes discarded in favor of newer conclusions.

For example, in business a manager may take a calculated risk early on in the stages of a project. When the early risks are negated, he may then take greater calculated risks towards completion of the intended goal.

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