Advanced Search
MyIDEAS: Login to save this paper or follow this series

When "hope springs eternal": The role of chance in risk taking

Contents:

Author Info

  • Natalia Karelaia
  • Robin Hogarth

    ()

Abstract

In most naturally occurring situations, success depends on both skill and chance. We contrast experimental market entry decisions where payoffs depend on skill as opposed to combinations of skill and chance. Our data show differential attitudes toward chance by those whose self-assessed skills are low and high. Making chance more important induces greater optimism for the former who start taking more risk, while the latter maintain a belief that high levels of skill are sufficient to overcome the vagaries of chance. Finally, although we observed “excess entry” (i.e., too many participants entered markets), this could not be attributed to overconfidence.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.econ.upf.edu/docs/papers/downloads/1131.pdf
File Function: Whole Paper
Download Restriction: no

Bibliographic Info

Paper provided by Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 1131.

as in new window
Length:
Date of creation: Dec 2008
Date of revision: Jun 2009
Handle: RePEc:upf:upfgen:1131

Contact details of provider:
Web page: http://www.econ.upf.edu/

Related research

Keywords: Skill; chance; overconfidence; optimism; competition; risk taking; gender differences;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Cowley, Elizabeth, 2013. "Forgetting the anxiety: Gamblers' reactions to outcome uncertainty," Journal of Business Research, Elsevier, vol. 66(9), pages 1591-1597.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:upf:upfgen:1131. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.