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Overconfidence: the roles of gender, public observability and incentives

Author

Listed:
  • Hayk Amirkhanyan

    (University of Warsaw)

  • Michał Krawczyk

    (University of Warsaw)

  • Maciej Wilamowski

    (University of Warsaw)

  • Paweł Bokszczanin

    (University of Warsaw)

Abstract

In this project, we manipulate the public observability of forecasts and outcomes of a physical task. We explore how these manipulations affect overconfidence (OC). Participants in the experiment are asked to hold a weight after predicting how long they think they could do it for. Comparing the prediction and outcome times (in seconds) yields a measure of OC. We independently vary two dimensions of public observability (of the outcome and of the prediction). Additionally, we manipulate incentives to come up with an accurate prediction. This design allows us to shed light on the mechanism behind male and female OC. Following the existing literature, we formulate several hypotheses regarding the differences in predictions and outcomes for males and females in the presence of the public observability of predictions and outcomes. Our experimental data do not provide support to most of the hypotheses: in particular, there is no evidence of a gender gap in overconfidence. The most robust finding that emerges from our results is that incentives on making correct predictions increase participants’ forecasts on their own performance (by about 24%) and their actual performance as well, but to a lower extent (by about 8%); in addition, incentives to predict correctly in fact increase error for females (by about 33%).

Suggested Citation

  • Hayk Amirkhanyan & Michał Krawczyk & Maciej Wilamowski & Paweł Bokszczanin, 2024. "Overconfidence: the roles of gender, public observability and incentives," Journal of the Economic Science Association, Springer;Economic Science Association, vol. 10(1), pages 76-97, June.
  • Handle: RePEc:spr:jesaex:v:10:y:2024:i:1:d:10.1007_s40881-023-00149-z
    DOI: 10.1007/s40881-023-00149-z
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    References listed on IDEAS

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    More about this item

    Keywords

    Field experiment; Overconfidence; Gender difference; Public forecasts; Public outcomes; Incentives;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination

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