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"I'll do it by myself as I knew it all along": on the failure of hindsight-biased principals to delegate optimally

[working paper]

Danz, David; Hüber, Frank; Kübler, Dorothea; Mechtenberg, Lydia; Schmid, Julia

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Please use the following Persistent Identifier (PID) to cite this document:http://hdl.handle.net/10419/71136

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Corporate Editor Wissenschaftszentrum Berlin für Sozialforschung gGmbH
Abstract With the help of a simple model, we show that the hindsight bias can lead to inefficient delegation decisions. This prediction is tested experimentally. In an online experiment that was conducted during the FIFA World Cup 2010 participants were asked to predict a number of outcomes of the ongoing World Cup and had to recall their assessments after the outcomes had been realized. This served as a measure of the hindsight bias for each participant. The participants also had to make choices in a delegation game. Our data confirm that hindsight-biased subjects more frequently fail to delegate optimally than subjects whom we have classified as not hindsight biased. (author's abstract)
Keywords experiment; delegation of tasks; soccer; world championship; evaluation
Classification Social Psychology
Free Keywords Rückschaufehler
Document language English
Publication Year 2013
City Berlin
Page/Pages 35 p.
Series Discussion Papers / Wissenschaftszentrum Berlin für Sozialforschung, Forschungsschwerpunkt Markt und Entscheidung, Abteilung Verhalten auf Märkten, SP II 2013-203
Status Published Version; reviewed
Licence Deposit Licence - No Redistribution, No Modifications