Belief updating among college students: evidence from experimental variation in information

Matthew Wiswall () and Basit Zafar

No 516, Staff Reports from Federal Reserve Bank of New York

Abstract: We investigate how college students form and update their beliefs about future earnings using a unique ?information? experiment. We provide college students true information about the population distribution of earnings and observe how this information causes respondents to update their beliefs about their own future earnings. We show that college students are substantially misinformed about population earnings and logically revise their self-beliefs in response to the information we provide, with larger revisions when the information is more specific and is good news. We classify the updating behaviors observed and find that the majority of students are non-Bayesian updaters.

Keywords: prediction; Wages; Universities and colleges; Demography; Uncertainty; Bayesian statistical decision theory (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-cta, nep-edu, nep-exp and nep-lab
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