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Disagreement and optimal security design

Ortner, Juan M.; Schmalz, Martin C. - 2018

We study optimal security design when the issuer and market participants agree to disagree about the characteristics of the asset to be securitized. We show that pooling assets can be optimal because it mitigates the effects of disagreement between issuer and investors, whereas tranching a...

Persistent link: https://www.econbiz.de/10011795041

Econographics

Chapman, Jonathan; Dean, Mark; Ortoleva, Pietro; … - 2018

We study the pattern of correlations across a large number of behavioral regularities, with the goal of creating an empirical basis for more comprehensive theories of decision-making. We elicit 21 behaviors using an incentivized survey on a representative sample (n = 1;000) of the U.S....

Persistent link: https://www.econbiz.de/10011897575

It's not my fault! : self-confidence and experimentation

Hestermann, Nina; Le Yaouanq, Yves - 2019 - Current draft: October 8, 2018

We study the inference and experimentation problem of an agent in a situation where the outcomes depend on the individual's intrinsic ability and on an external variable. We analyze the mistakes made by decision-makers who hold inaccurate prior beliefs about their ability. Overconfident...

Persistent link: https://www.econbiz.de/10011966912

Self-confidence and strategic behavior

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

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

Persistent link: https://www.econbiz.de/10010223063

Controlling product risks when consumers are heterogeneously overconfident : producer liability vs. minimum quality standard regulation

Baniak, Andrzejj; Grajzl, Peter - 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/10010413791

Taxing mobile and overconfident top earners

Haufler, Andreas; Nishimura, Yukihiro - 2020

are not. In this setting we show that overconfidence (i) unambiguously increases the bonus component in the managers … overconfidence can contribute to explaining both the increasing role of bonus contracts and the fall in marginal tax rates for high …

Persistent link: https://www.econbiz.de/10012287316

Self-serving biases in beliefs about collective outcomes

Kogan, Shimon; Schneider, Florian; Weber, Roberto A. - 2021

Beliefs about collective outcomes, such as economic growth or firm profitability, play an important role in many contexts. We study biases in the formation of such beliefs. Specifically, we explore whether over-optimism and self-serving biases in information processing—documented for beliefs...

Persistent link: https://www.econbiz.de/10012494819

Illusion of expertise in portfolio decisions : an experimental approach

Fellner, Gerlinde; Güth, Werner; Maciejovsky, Boris - 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/10011408429

A model of reference-dependent belief updating

Maier, Johannes K.; König, Clemens - 2016

We propose a model of instrumental belief choice under loss aversion. When new information arrives, an agent is prompted to abandon her prior. However, potential posteriors may induce her to take actions that generate a lower utility in some states than actions induced by her prior. These losses...

Persistent link: https://www.econbiz.de/10011557745

Overconfidence and gender equality in the labor market

Bastani, Spencer; Giebe, Thomas; Gürtler, Oliver - 2023

Gender differences in overconfidence have been extensively documented in the empirical literature, but the implications … for labor market outcomes are not well understood. In this paper, we analyze how men's relatively higher overconfidence …, they incur higher effort costs and discourage their peers, and we find that overconfidence can be either self-serving or …

Persistent link: https://www.econbiz.de/10014249676