Comparative ignorance hypothesis and business training

Dmitry A. Shapiro

Economics Letters, 2020, vol. 197, issue C

Abstract: The comparative ignorance hypothesis, first demonstrated in Heath and Tversky (1991), is that ambiguity aversion is driven by the comparison with more familiar events or more knowledgeable individuals. For example, when own ignorance is perceived to be higher, individuals tend to exhibit stronger ambiguity aversion. We use this insight to provide a theoretical explanation to a well-documented phenomenon of business training having limited, or even negative, effect on post-training profits of program participants.

Keywords: Comparative ignorance hypothesis; Business training; Ambiguity aversion (search for similar items in EconPapers)
JEL-codes: D81 D91 O12 O16 (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:197:y:2020:i:c:s0165176520304006

DOI: 10.1016/j.econlet.2020.109640

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