the psychology of successful trading

What Is “Theory Of Mind?”

Introduction to Theory of Mind

“Theory of Mind” is the label for how we predict and explain the behaviour of others. More details at the link below:

People are very good at predicting and explaining each other’s behaviour.  We are so good at it, that often we do not realise we are doing it.  And it is very unclear how we do it.  In this post, I will briefly introduce some ideas in psychology about how we do it.

Theory of Mind was originally called that because the first idea was that we have a theory of other people.  On this account, we learn this theory as children, or it is innate — meaning we are born with it.  It ought to be something like a theory in that it has some kind of rules in a system.  They would say things like “everyone who wants some ice cream will go where they think the ice cream is.”

Subsequently, there was a debate as to whether this was really the right explanation for our Theory of Mind.  Alternative accounts emerged.  This means that some new terminology was required.  The account I have already outlined above, where people use a theory to predict and explain others, became known as Theory Theory.  It was, if you like, the theory that using a theory is how we do Theory of Mind!  We use rules to predict and explain the actions of others.

The Simulation Theory Account of Theory of Mind

The challenger account was called Simulation Theory.  This says that people predict and explain others by simulating them.  In other words, I predict what you will do in a situation by imagining that I am in that situation and then deciding what I would do.  I might think (implicitly probably) “I want some ice cream, where would I go?”

We can see that both methods produce results that look plausible, to begin with.  Both of them would account for the way that if I say to you “why did Jimmy go to the ice cream van?,” you don’t have any difficulty coming up with what looks like a good answer.  What we don’t know is whether you came up with that answer by using a rule (Theory Theory) or put yourself in Jimmy’s place (Simulation Theory).

An Objection to Simulation Theory

The debate continues as to whether Theory Theory or Simulation Theory is correct.  The major objection to Simulation Theory was that it could not explain cases of systematic Theory of Mind error.  In the Stanford Prison experiment, for example, the participants acted much more harshly than anyone outside the situation predicted.  Those objecting to Simulation Theory said that if it was the correct account of Theory of Mind, then we would be able to get the right answer.  We would be able to correctly predict the harshness of the participants by imagining that we were there.

Handling the Objection

I have provided what I think is the only response to this objection.  I call it the bias mismatch defence.  In it, suggest that if there is a systematic error in Theory of Mind, like the one in the prison experiment, it is because the people in the experiment are acting under a common cognitive bias, and the people outside it are not.  They do not simulate the bias, in other words.  There could be several reasons why they do not simulate it.  They might, for example, have no particular emotional involvement in the situation.  After all, being outside prison is much less intense than being in prison!

Photo by Alexander Krivitskiy on

In this particular case of the prison experiment, I think the bias in question is Conformity Bias.  This is the way we all tend to do what we are told, to some extent.  But I could use this bias mismatch approach much more widely.  It could be used to explain any cases where people systematically fail to predict how experimental participants will react, if those participants can be seen to be exhibiting any cognitive bias.  We know about more than 150 of those so far, so there is plenty of opportunity for bias mismatch to arise.  This bias mismatch happens a lot I think, and it is why so many results in social psychology are interesting and surprising — and also why so often, we fail to understand others.

See Also: Simulation Theory: A psychological and philosophical consideration