A Model of Rational Bias in Self-Assessments
JAN ZABOJNIK
Queen's University - Department of Economics
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2003
Abstract:
A body of empirical work documents that most people believe they are above average in a variety of skills and abilities. This paper argues that such evidence does not necessarily imply that people process information in an irrational way. I build a model in which people can learn about their abilities at a cost of foregone production. Individuals in this model keep testing their abilities until their self-assessments become favorable enough, at which point they stop. This way, a disproportionately large share of the population ends up with a high opinion about their abilities.
Keywords: Bias in self-assessments, Overconfidence, Learning about ability
1 comment:
We had a similar discussion the other day in regard to perceived driving capabilities. These seem highly dependent on impulsivity, sensation seeking, risk aversion etc. I think the tendency to impulsively accept a superficial solution to a question may be a key individual difference in relation to the confirmation bias and 'quit while you're ahead' effects described here. That said I'm sure self-congratulatory heuristics do wonders for levels of well-being and even health!
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