It is common for a majority of people to rank themselves as better than average on simple tasks and worse than average on dificult tasks. The literature takes for granted that this apparent miscon?dence is problematic. We argue, however, that this behaviour is consistent with purely rational...

Many disasters are foreshadowed by insuficient preventive care. In this paper, we argue that there is a true problem of prevention, in that insu¢ cient care is often the result of rational calculations on the part of agents. We identify two factors that lead to dubious e¤orts in care. First,...

Miscalibration can be defined as the fact that people think that their knowledge is more precise than it actually is. In a typical miscalibration experiment, subjects are asked to provide subjective confidence intervals. A very robust finding is that subjects provide too narrow intervals at the...

Many disasters are foreshadowed by insuficient preventive care. In this paper, we argue that there is a true problem of prevention, in that insu¢ cient care is often the result of rational calculations on the part of agents. We identify two factors that lead to dubious e¤orts in care. First,...

This paper provides the first evidence for empirical sensitivity of trading volume to human psychological factors. We review therefore extensive evidence about how human psychology affects investor behavior and trading volume. Using the data for individual stocks listed on the CAC40 Stock Market...