This article examines public attitudes toward university admissions rules by focusing on the imposition of the costs of racial diversity across majority citizens. High-income majority citizens, who tend to have better academic qualifications, favor more diversity under affirmative action, which...

Although most of the political-economy literature blames inefficient policies on institutions or politicians' motives to supply bad policy, voters may themselves be partially responsible by demanding bad policy. In this paper, we posit that voters may systematically err when assessing potential...

We investigate experimentally whether social learners appreciate the redundancy of information conveyed by the behavior of those they observe. Each experimental participant observes a private signal and enters an estimate of the sum of all earlier-moving participants' signals plus her own. In a...

We present a model of a financial market where some traders are "cursed" when choosing how much to invest in a risky asset, failing to fully take into account what prices convey about others' private information. Cursed traders put more weight on their private signals than rational traders. But...

We model a financial market where some traders of a risky asset do not fully appreciate what prices convey about others' private information. Markets comprising solely such "cursed" traders generate more trade than those comprising solely rationals. Because rationals arbitrage distortions caused...

This paper shows how political parties differentiate to reduce electoral competition. Two parties choose platforms in a unidimensional policy space, and then candidates from these parties compete for votes in a continuum of constituencies with different median voters. Departing from their...