Does method of acquisition affect the quality of expert judgment? A comparison of education with on‐the‐job learning

Expertise can be acquired through experience or through education, and many occupations demand a mixture of both. In this paper we evaluate the level of expertise acquired through these two routes by comparing credit decisions made by professional credit managers (who have learned through experience rather than education) and lecturers and students in management, (who have no experience but have learned the relevant concepts). We also tested a control group of laypeople with neither relevant formal education nor experience. Participants assumed the role of credit manager and made creditworthiness predictions and credit granting decisions for six companies with known performance. Lecturers and students generally outperformed credit managers on the prediction tasks, and the credit managers performed only slightly better than laypeople. In short, for at least one domain, it appears to be more efficient to learn from formal education than from experience. We argue that the prerequisites for successful learning are largely absent from the everyday experience of credit managers, but are present in an educational context.