Fascinating chapter in the book "How People Learn : Brain, Mind, Experience, and School
" from the Committee on Developments in the Science of Learning published in 2000 about "How Experts Differ from Novices"; It has significant repercussions for Investors and where they get their information from.
Consider:
- Experts notice features and meaningful patterns of information that are not noticed by novices.
- Experts have acquired a great deal of content knowledge that is organized in ways that reflect a deep understanding of their subject matter.
- Experts' knowledge cannot be reduced to sets of isolated facts or propositions but, instead, reflects contexts of applicability: that is, the knowledge is "conditionalized" on a set of circumstances.
- Experts are able to flexibly retrieve important aspects of their knowledge with little intentional effort.
- Though experts know their disciplines thoroughly, this does not guarantee that they are able to teach others.
- Experts have varying levels of flexibility in their approach to new situations.
Bottom line: Experts first seek to develop an understanding of problems, and this often involves thinking in terms of core concepts or big ideas. Novices' knowledge is much less likely to be organized around big ideas; they are more likely to approach problems by searching for correct formulas and pat answers that fit their everyday intuitions.
But what is an "expert"? What do we mean when we call someone an "expert"? These turn out to be somewhat more difficult questions than they seem. I would assert that the following characteristics in combination must be evaluated to determine if someone reaches the standard to be considered an expert in a particular topic.
- Knowledge. Being comfortably conversant with the key facts, principles, and techniques within a discipline. Such knowledge may be gained from formal education, apprenticeship, reading relevant books, academic papers or other topical sources.
- Experience. Time spent practicing in a topic area applying knowledge to solve problems or derive new insights. This is 20 years experience where one year builds on another driving higher levels of understanding. It is not 20 one-year experiences where time elapses without new insight gained.
- Talent. Experts need a certain skill in their specific topic that others do not have. They must have a developed or natural talent for the topic.
- Confirmation. The certification from others that someone is an expert. To be recognized by others. A formal degree. Documented peer recognition. Being quoted by others in presentation or writing. Being consulted by others for your expertise.
No one of these characteristics is enough. For example, one can know and recite many facts demonstrating considerable knowledge but have little insight into what the facts mean, how to apply them to solve problems or draw useful conclusions from them. This is not expertise. Just having a college degree is not enough.
It is the people that meet these standards to whom I reference above as "experts".