Do we measure overconfidence? A closer look at the interval production task

Ferdinand Langnickel and Stefan Zeisberger

Journal of Economic Behavior & Organization, 2016, vol. 128, issue C, 121-133

Abstract: The most common test for overconfidence in the form of miscalibration—the interval production task (IP)—is based on the assumption that people internalize requested confidence levels. We demonstrate experimentally that decision makers’ perceived confidence is, however, unaffected by variations in the requested confidence level. In addition, we find large heterogeneity in perceived confidence that the traditional IP measure fails to account for. We show that the alternative measure based on decision makers’ perceived confidence by contrast yields coherent, moderate overconfidence levels. Our evidence suggests that the consistency of the two measures is limited and that they are related to different individual characteristics.

Keywords: Overconfidence; Miscalibration; Methodology; Experimental economics; Experimental finance (search for similar items in EconPapers)
JEL-codes: D83 G02 G12 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:128:y:2016:i:c:p:121-133

DOI: 10.1016/j.jebo.2016.04.019

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