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Rational truth‐avoidance and self‐esteem

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  • David Andolfatto
  • Steeve Mongrain
  • Gordon Myers

Abstract

We assume that people have beliefs about their abilities that generate self‐esteem, and that self‐esteem is valued intrinsically. Individuals face two choices; one of which strictly dominates the other in a pecuniary sense, but necessarily involves gathering information concerning their ability. We lay out the circumstances under which an individual may find it rational to reject the dominant choice, an act that, in psychology is described as avoiding the situation. We then go on to show that the incentive to avoid the truth is increasing in income/wealth and decreasing in self‐esteem, the perceived accuracy of one's self‐assessment, and the role that luck plays in generating opportunities. On part des postulats que les gens ont des croyances quant à leurs habiletés et que ces croyances engendrent l'estime de soi, et que l'estime de soi est valorisée en soi. Des individus sont confrontés à une situation de choix entre deux possibilités: l'une de ces possibilités domine strictement l'autre au plan pécuniaire, mais nécessite la cueillette de renseignements concernant les habiletés de la personne. On développe un cadre dans lequel un individu peut trouver rationnel de ne pas choisir le possible dominant; un choix que l'on nomme en psychologie ‘éviter la situation'. On montre ensuite que l'incitation àéviter la vérité augmente à proportion que le revenu et la richesse s'accroissent mais diminue à mesure que l'estime de soi, le sens qu'on est exact dans son auto‐évaluation, et l'importance qu'on accorde à la chance dans la genèse des opportunités – s'accroissent.

Suggested Citation

  • David Andolfatto & Steeve Mongrain & Gordon Myers, 2009. "Rational truth‐avoidance and self‐esteem," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 42(1), pages 141-154, February.
  • Handle: RePEc:wly:canjec:v:42:y:2009:i:1:p:141-154
    DOI: 10.1111/j.1540-5982.2008.01502.x
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    References listed on IDEAS

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    1. Gervais, Simon & Odean, Terrance, 2001. "Learning to be Overconfident," Review of Financial Studies, Society for Financial Studies, vol. 14(1), pages 1-27.
    2. Matthew Rabin & Joel L. Schrag, 1999. "First Impressions Matter: A Model of Confirmatory Bias," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(1), pages 37-82.
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    Cited by:

    1. Isabelle Vialle & Luis Santos-Pinto & Jean-Louis Rullière, 2011. "Self-Confidence and Teamwork : An Experimental Test," Working Papers 1126, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    2. Blanco, M. & Dalton, P.S. & Vargas, J.F., 2013. "Does the Unemployement Benefit Institution Affect the Productivity of Workers? Evidence from a Field Experiment," Other publications TiSEM ba37e033-06ab-4fc3-b56e-9, Tilburg University, School of Economics and Management.
    3. Valeria Maggian & Antonio Nicolò, 2016. "The wrong man for the job: biased beliefs and job mismatching," Post-Print halshs-01324733, HAL.
    4. Akiko Maruyama, 2013. "Learning about one's own type: a search model with two-sided uncertainty," GRIPS Discussion Papers 12-24, National Graduate Institute for Policy Studies.

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    More about this item

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D1 - Microeconomics - - Household Behavior

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