Deconstruction and reconstruction of an anomaly

Dirk Engelmann and Martin Strobel

Games and Economic Behavior, 2012, vol. 76, issue 2, 678-689

Abstract: We present a striking example of the deconstruction and reconstruction of an anomaly. In line with previous experiments we show in a one-shot setting that the allegedly robust false consensus effect disappears if representative information is readily available. But the effect reappears if a small cognitive effort is required to retrieve the information. Most subjects apparently ignore valuable information if it is not handed to them on a silver platter. We conclude that the relevance of the false consensus effect depends on the difficulty of retrieving the information and that the underlying mechanism is an information processing deficiency rather than egocentricity. Moreover, we discuss the potential relevance of our findings for other well-known effects like the winnerʼs curse and overconfidence.

Keywords: Anomalies; False consensus; Information processing; Experimental economics (search for similar items in EconPapers)
JEL-codes: C91 D83 D84 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (49)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:76:y:2012:i:2:p:678-689

DOI: 10.1016/j.geb.2012.07.009

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