We've all had awkward moments of saying the wrong thing or reaching for a handshake or a hug at the wrong time. It can be embarrassing and more than a little uncomfortable, but the sense of feeling awkward can help us. Many times, mistakes are made socially because we are unaware of ourselves or the norms of our surroundings. Getting something wrong forces us to be self-conscious and focus on our behavior so we can correct it. That awkward feeling redirects us to see ourselves as others do.
Developmentally, the brain becomes self-aware around 18 months. This is about the age that babies and toddlers will recognize themselves in a mirror. Humans have two kinds of self-awareness; our own internal view of ourselves and eventually we can perceive how others see us. Humans are highly social, and awareness is key to managing our relationships. While we have to develop an understanding of how we appear to others, there will always be a small disconnect. Phillip Rochat called it the irreconcilable gap, and it's pretty permanent. Experiments have shown that we think lots of people are noticing us, but in reality, if 100 people are in a room and one person is wearing a very obvious shirt, only about 25% of those in the room will notice it, compared to the 50% figure the wearer estimates will notice it.