Using belief elicitation, the paper investigates the formation and the evolution of beliefs in a signalling game in which a common prior on Sender's type is not induced. Beliefs are elicited about the type of the Sender and about the strategies of the players. The experimental subjects often...

We experimentally investigate the determinants of overconfidence and test the hypothesis, advanced by Robert Trivers, that overconfidence serves to more effectively persuade or deceive others. After performing a cognitively challenging task, half of our subjects are informed about the...

We designed an experiment that examines how knowledge about the price of a good, and the time at which the information is received, affects how the good is experienced. The good in question was wine, and the price was either high or low. Our results suggest that hosts offering wine to guests can...

Optimistic beliefs affect important areas of economic decision making, yet direct knowledge on how belief biases operate remains limited. To better understand these biases I introduce a theoretical framework that trades off anticipatory benefits against two potential costs of forming biased...