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How Do Judgmental Overconfidence and Overoptimism Shape Innovative Activity?

Herz, Holger; Schunk, Daniel; Zehnder, Christian - CESifo - 2013

Recent field evidence suggests a positive link between overconfidence and innovative activities. In this paper we argue … that the connection between overconfidence and innovation is more complex than the previous literature suggests. In … particular, we show theoretically and experimentally that different forms of overconfidence may have opposing effects on …

Persistent link: https://www.econbiz.de/10010877694

Self-Confidence and Strategic Behavior

Charness, Gary; Rustichini, Aldo; Ven, Jeroen van de - CESifo - 2013

salient perturbations, we propose a strategic foundation of overconfidence. Since overconfident statements are used in …

Persistent link: https://www.econbiz.de/10010877986

Controlling Product Risks when Consumers are Heterogeneously Overconfident: Producer Liability vs. Minimum Quality Standard Regulation

Baniak, Andrzej; Grajzl, Peter - CESifo - 2014

Contributing to the literature on the consequences of behavioral biases for market outcomes and institutional design, we contrast producer liability and minimum quality standard regulation as alternative means of social control of product-related torts when consumers are heterogeneously...

Persistent link: https://www.econbiz.de/10010948857

Illusion of Expertise in Portfolio Decisions - An Experimental Approach

Fellner, Gerlinde; Güth, Werner; Maciejovsky, Boris - CESifo - 2001

Overall, 72 subjects invest their endowment in four risky assets. Each com-bination of assets yields the same expected return and variance of returns. Illusion of expertise prevails when one prefers nevertheless the self-selected portfolio. After being randomly assigned to groups of four...

Persistent link: https://www.econbiz.de/10005013059

Optimal Illusions and Decisions under Risk

Gollier, Christian - CESifo - 2005

We examine a static one-risk-free-one-risky asset portfolio choice when the investor’s well-being is affected by the anticipatory feelings associated to potential capital gains and losses. These feelings can be manipulated by the choice of subjective beliefs on the distribution of returns....

Persistent link: https://www.econbiz.de/10005406370

Overconfidence in a Career-Concerns Setting

Rosa, Leonidas Enrique De La - CESifo - 2008

We study the effects of overconfidence in a two-period investment-decision agency setting. Under common priors, agent … from first-period investment. This implies that agent overconfidence mitigates the agency problems arising from the agent …

Persistent link: https://www.econbiz.de/10005406373