Confirmation bias with motivated beliefs

Gary Charness and Chetan Dave

Games and Economic Behavior, 2017, vol. 104, issue C, 1-23

Abstract: We investigate whether the confirmation bias is mitigated in signal-extraction environments by outside financial interests. We include a background strategic consideration leading to ‘motivated beliefs’ for people in one role, as they receive higher equilibrium payoffs in a background game in one of two states, while people in the other role receive the same equilibrium payoffs in both. We find systematic differences in beliefs and our results suggest that players with motivated beliefs deviate less from Bayesian updating. However, such players still exhibit a confirmation bias in that they place additional weight on confirming information, in contrast to Bayesians.

Keywords: Confirmation bias; Motivated beliefs; Bayesian updating; Experiment (search for similar items in EconPapers)
JEL-codes: C91 D03 D80 G02 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (46)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:104:y:2017:i:c:p:1-23

DOI: 10.1016/j.geb.2017.02.015

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