Winner and loser effects, in which the outcome of an aggressive encounter influences the tendency to escalate future conflicts, have been documented in many taxa, but we have limited understanding of why they have evolved. One possibility is that individuals use previous victories and defeats to assess their fighting ability relative to others. We explored this idea by modelling a population of strong and weak individuals that do not know their own strength, but keep track of how many fights they have won. Under these conditions, adaptive behaviour generates clear winner and loser effects: individuals who win fights should escalate subsequent conflicts, whereas those who lose should retreat from aggressive opponents. But these effects depend strongly on age and experience. Young, naive individuals should show highly aggressive behaviour and pronounced loser effects. For these inexperienced individuals, fighting is especially profitable because it yields valuable information about their strength. Aggression should then decline as an individual ages and gains experience, with those who lose fights becoming more submissive. Older individuals, who have a better idea of their own strength, should be more strongly influenced by victories than losses. In conclusion, we predict that both aggressiveness and the relative magnitude of winner and loser effects should change with age, owing to changes in how individuals perceive their own strength.