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The curse of knowledge increases self-selection into competition: experimental evidence
[working paper]
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Wissenschaftszentrum Berlin für Sozialforschung gGmbH
Abstract 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 context... view more
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 context, the results provide an explanation for the overconfidence of nascent entrepreneurs and the substantial rate of failure among new businesses. (author's abstract)... view less
Keywords
knowledge; self-confidence; competition; incentive system; experiment; information; enterprise; behavior
Classification
Social Psychology
National Economy
Sociology of Knowledge
Free Keywords
Überschätzung
Document language
English
Publication Year
2014
City
Berlin
Page/Pages
64 p.
Series
Discussion Papers / Wissenschaftszentrum Berlin für Sozialforschung, Forschungsschwerpunkt Markt und Entscheidung, Abteilung Verhalten auf Märkten, SP II 2014-207
Handle
https://hdl.handle.net/10419/101453
Status
Published Version; reviewed
Licence
Deposit Licence - No Redistribution, No Modifications