EconPapers    
Economics at your fingertips  
 

OPTIMISTIC BEHAVIOR WHEN A DECISION BIAS IS COSTLY: AN EXPERIMENTAL TEST

Astri Muren ()

Economic Inquiry, 2012, vol. 50, issue 2, 463-469

Abstract: The existence of optimism when biased decisions are costly is investigated experimentally. Subjects make an informed guess about an exogenously determined event: the outside temperature a couple of days later. Payments in the control group depend only on how close the guess was to the realized temperature, while payments in the treatment group also depend positively on realized temperature. The data show the treatment group subjects to guess higher temperatures, that is, higher payments, compared with the control group. Results thus indicate that there is optimism also when a decision bias is costly. (JEL C91, D81, D84)

Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4) Track citations by RSS feed

Downloads: (external link)
https://doi.org/10.1111/j.1465-7295.2010.00359.x

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:ecinqu:v:50:y:2012:i:2:p:463-469

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0095-2583

Access Statistics for this article

Economic Inquiry is currently edited by Preston McAfee

More articles in Economic Inquiry from Western Economic Association International Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().

 
Page updated 2021-06-10
Handle: RePEc:bla:ecinqu:v:50:y:2012:i:2:p:463-469