Do differing pay schemes help close the gender gap in overconfidence

Eyal Lahav (), Arad Nir () and Erez Siniver ()
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Eyal Lahav: The College of Management
Arad Nir: The College of Management
Erez Siniver: The College of Management

Economics Bulletin, 2015, vol. 35, issue 1, 30-36

Abstract: We conducted an experiment to compare how overconfidence is influenced by performance-based and fixed payment schemes. Participants in the experiment were students prior to taking a final exam in Introduction to Microeconomics. We find that most participants were overconfident regarding their success on the exam, overestimating the number of questions they would answer correctly. When a fixed pay scheme was used, men were more overconfident than women. Performance-based pay increased the overconfidence of women, and decreased the overconfidence of men. As a result, no gender difference in overconfidence was found when pay is based on performance.

Keywords: Overconfidence; gender; bonuses; performance pay; self evaluation (search for similar items in EconPapers)
JEL-codes: J1 J3 (search for similar items in EconPapers)
Date: 2015-03-11
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Citations: View citations in EconPapers (7)

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