The psychology literature provides ample evidence that people have difficulties taking the perspective of less-informed others. This paper presents a controlled experiment showing that this "curse of knowledge" can cause comparative overconfidence and overentry into competition. In a broader...

The psychology literature provides ample evidence that people have difficulties taking the perspective of less informed others. This paper presents a controlled experiment showing that this "curse of knowledge" can cause comparative overconfidence and overentry into competition. In a broader...

An individual is affected by the curse of knowledge when he fails to appreciate the viewpoint of a lesser-informed agent. In contrast to a rational person, the cursed individual behaves as if part of his private information were common knowledge. This systematic cognitive bias alters many...

An individual is affected by the curse of knowledge when he fails to appreciate the viewpoint of a lesser-informed agent. In contrast to a rational person, the cursed individual behaves as if part of his private information were common knowledge. This systematic cognitive bias alters many...

The psychology literature provides ample evidence that people have difficulties taking the perspective of less-informed others. This paper presents a controlled experiment showing that this "curse of knowledge" can cause comparative overconfidence and overentry into competition. In a broader...

This paper proposes a behavioral model of social learning that unies various forms of inferential reasoning in one hierarchy of types. Iterated best responses that are based on uninformative level-0 play lead to the following of the private information (level-1), to the following of the majority...

We report on experiments examining the value of commitment in Stackelberg games where the follower chooses whether to pay some cost to perfectly observe the leader's action. Várdy (2004) shows that in the unique pure strategy subgame perfect equilibrium of this game, the value of commitment is...

The psychology literature provides ample evidence that people have difficulties taking the perspective of less informed others. This paper presents a controlled experiment showing that this "curse of knowledge" can cause comparative overconfidence and overentry into competition. In a broader...

We study markets for information in the form of Bayesian signals. The main feature of such markets is that information is costly for the seller to acquire and cannot be verified by the buyer. We provide a full characterization of the set of all compensation schemes (viz., menus) which guarantee...

Instrumental variable estimation requires untestable exclusion restrictions. With policy effects on individual outcomes, there is typically a time interval between the moment the agent realizes that he may be exposed to the policy and the actual exposure or the announcement of the actual...