The effectiveness of decision rules depends on characteristics of both rules and environments. A theoretical analysis of environments specifies the relative predictive accuracies of the lexicographic rule "take-the-best" (TTB) and other simple strategies for binary choice. We identify three...

Excess entry refers to the high failure rate of new entrepreneurial ventures. Economic explanations suggest 'hit and run' entrants and risk-seeking behavior. A psychological explanation is that people (entrepreneurs) are overconfident in their abilities (Camerer & Lovallo, 1999). Characterizing...

We study the gender gap in a competitive environment by exploiting the “naturalistic experiment” of a TV game show with self-selected participants and no gender-specific constraints nor discrimination. Games consist of multiple rounds where contestants answer general knowledge questions...

Confidence in decision making is an important dimension of managerial behavior. However, what is the relation between confidence and feedback on decisions? To explore this and related issues, use was made of the ESM (Experience Sampling Method) to sample decisions taken by students and business...

People can make judgments and choices in two modes - the tacit (or intuitive) and deliberate (or analytic). This chapter examines the conditions under which each system is likely to be more effective. Distinctions are made between types of information typically used as well as the...

We study the risk-taking behavior of stock analysts under varying market conditions. We examine how the risk analysts take by providing bold forecasts that deviate from consensus depends on the degree of uncertainty in the environment as well as the analysts' skill level. We provide evidence...

Whereas economists have made extensive studies of the impact of levels of incentives on behavior, they have paid little attention to the effects of regularity and frequency of incentives. We contrasted three ways of rewarding participants in a real-effort experiment in which individuals had to...

Forecasts are crucial for practically all economic and business decisions. However, there is a mounting body of empirical evidence showing that accurate forecasting in the economic and business world is usually not possible. In addition, there is huge uncertainty, as practically all economic and...