Biology of Business

Concept · Cognitive Bias: Decision-making and judgment biases

Hindsight bias ("knew-it-all-along" effect)

Origin: Fischhoff, 1975

By Alex Denne

Biological Parallel

After wolves attack from upwind, surviving elk 'remember' wind direction as obviously wrong—though wind seemed irrelevant before the attack. Hindsight bias retrospectively strengthens causal patterns: memory rewrites ambiguous cues as clear warnings, extracting signal from noise. This isn't memory failure; it's learning optimization. Animals that encoded 'I should have known' extracted teachable patterns from randomness faster than those accepting unpredictability. Your 'knew-it-all-along' feeling is neural pattern-extraction treating the past as a training dataset.