Even dumb people think they’re above average intelligence
There's an obvious observation that a lot of this is to do with protection of one's own well-being because the truth might be too painful to bear, alongside just general human tendencies.
But I think there are conditions in modern living that exaggerate it and maybe even make it a necessary component of survival. After all, you do need a degree of assertiveness (we cannot all be calm, soft spoken intellectual, scientific, technical and just generally skilled geniuses) that might occasionally border on the level of arrogance in order to get a slice of the pie for yourself.
For the vast majority of us the world comes across as a loud & fast paced mess of people scrabbling to get near an imaginary top of the heap. And since most of us are average then the best option for that material wealth we're told we want and to which we also need (to a degree) lies in managerial positions in administration. That's partly why bureaucracy is such a powerful influence in the world, I think, and we do require a great degree of organisation; it's true. But after a while there appears to develop this kind of... 'excess' in piling up repetition on top of repetition.
In Terry Gilliam's film, Brazil that's actually one of main themes in my opinion (and great thanks to [MENTION=9273]Vasilisa[/MENTION] for introducing me to it). Terry is fairly well known for not liking bureaucratic meddling, particularly in creative people's projects (as happened with Handmade studios but that's a long story) and there is a particular scene in Brazil where we are introduced to the protagonist's place of work and it is simply people taking joy in being repetitively productive for the sake of it.
And that lack of needing complicated or adaptive thinking means it's a useful avenue for giving those of us that are the average majority a chance to make at least a decent living. And thinking of yourself as above average could play a part in getting a person up that ladder.
Although it also causes great harm too, particularly with dangerously productive idiots.