Ability, Self-Confidence, and Search
We explore optimal search for individual improvement when agents start with different confidence in their own ability. The initial self-confidence may be determined by nature or socioeconomic factors. Presuming Bayesian learning, we show that final achievements depend positively on initial confidence. When parents' achievements affect children's self-confidence, a meritocracy, not necessarily founded on ability, may emerge. Social differences may thus stem from - and maintain - unjustifiable opinions about ability differentials.
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Volume (Year): 159 (2003)
Issue (Month): 3 (September)
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