Belief Elicitation and Behavioral Incentive Compatibility

David Danz, Lise Vesterlund and Alistair Wilson

American Economic Review, 2022, vol. 112, issue 9, 2851-83

Abstract: Subjective beliefs are crucial for economic inference, yet behavior can challenge the elicitation. We propose that belief elicitation should be incentive compatible not only theoretically but also in a de facto behavioral sense. To demonstrate, we show that the binarized scoring rule, a state-of-the-art elicitation, violates two weak conditions for behavioral incentive compatibility: (i) within the elicitation, information on the incentives increases deviations from truthful reporting; and (ii) in a pure choice over the set of incentives, most deviate from the theorized maximizer. Moreover, we document that deviations are systematic and center-biased, and that the elicited beliefs substantially distort inference.

JEL-codes: D83 D91 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (42)

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DOI: 10.1257/aer.20201248

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