Marginalium

SSRN article on the extent to which we underestimate skill decay:

we investigate the accuracy of beliefs about skill decay. Participants consistently underestimated their own skill decay by 28% to 59% across tasks. Even after directly experiencing skill decay, participants continued to underpredict its extent. We identify two mechanisms driving this underestimation: First, participants were more accurate in predicting others’ skill decline than their own, suggesting ego-based motivations are at play. Second, both subgroup heterogeneity and variable importance analyses reveal an underappreciation of the adverse impact of age on skill decay. Together, these findings suggest systematic misjudgments of skill retention, with implications for human capital investment decisions.