Overconfidence Increases Productivity
AbstractRecent studies report that productivity increases under tournament reward structures than under piece rate reward structures. We conduct maze-solving experiments under both reward structures and reveal that overconfidence is a significant factor in increasing productivity. Specifically, subjects exhibiting progressively higher degrees of overconfidence solve more mazes. This result shows a positive aspect of overconfidence, which usually has been examined in its negative aspect as an expectation bias.
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Bibliographic InfoPaper provided by Institute of Social and Economic Research, Osaka University in its series ISER Discussion Paper with number 0814.
Date of creation: 01 Aug 2011
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-08-09 (All new papers)
- NEP-CBE-2011-08-09 (Cognitive & Behavioural Economics)
- NEP-EFF-2011-08-09 (Efficiency & Productivity)
- NEP-EVO-2011-08-09 (Evolutionary Economics)
- NEP-EXP-2011-08-09 (Experimental Economics)
- NEP-HRM-2011-08-09 (Human Capital & Human Resource Management)
- NEP-LMA-2011-08-09 (Labor Markets - Supply, Demand, & Wages)
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