Exponential growth bias

What it is

Underestimating how quickly quantities grow when they compound.

Related

• Hyperbolic discounting bias
  Both are mistakes about time: misjudging how fast things compound and how much later rewards are worth.
• Planning fallacy bias
  Both are errors about how fast things build: compounding in one case, accumulating delays and costs in the other.
• Forecast illusion bias
  Linear thinking about compounding quantities produces forecasts that are far too low or too high.

Appears in

• The 99 thinking errors in Rolf Dobelli's The Art of Thinking Clearly#34: Exponential growth

References

• Wikipedia: Exponential growth bias en.wikipedia.org
• The 99 thinking errors in Rolf Dobelli's The Art of Thinking Clearly en.wikipedia.org
• Wikipedia: List of cognitive biases en.wikipedia.org
• Wikipedia: Cognitive bias codex en.wikipedia.org

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