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Strategically delusional

Author

Listed:
  • Alice Solda

    (Queensland University of Technology; University of Lyon)

  • Changxia Ke

    (Queensland University of Technology)

  • Lionel Page

    (Queensland University of Technology; University of Technology Sydney)

  • William von Hippel

    (University of Queensland)

Abstract

We aim to test the hypothesis that overconfidence arises as a strategy to influence others in social interactions. We design an experiment in which participants are incentivised either to form accurate beliefs about their performance at a test, or to convince a group of other participants that they performed well. We also vary participants� ability to gather information about their performance. Our results provide, the different empirical links of von Hippel and Trivers� (2011) theory of strategic overconfidence.

Suggested Citation

  • Alice Solda & Changxia Ke & Lionel Page & William von Hippel, 2019. "Strategically delusional," Working Paper Series 2019/05, Economics Discipline Group, UTS Business School, University of Technology, Sydney.
    • Handle: RePEc:uts:ecowps:2019/05
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    File URL: https://www.uts.edu.au/sites/default/files/2019-06/Lionel%20Page%20strategically.pdf
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    References listed on IDEAS

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    Cited by:

    1. Barron, Kai & Gravert, Christina, 2022. "Confidence and career choices: an experiment," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 124(1), pages 35-68.
    2. Thaler, Michael, 2021. "Gender differences in motivated reasoning," Journal of Economic Behavior & Organization, Elsevier, vol. 191(C), pages 501-518.
    3. Claire Rimbaud & Alice Soldà, 2024. "Avoiding the cost of your conscience: belief dependent preferences and information acquisition," Experimental Economics, Springer;Economic Science Association, vol. 27(3), pages 491-547, July.
    4. Barron, Kai & Becker, Anna & Huck, Steffen, 2025. "Motivated political reasoning: On the emergence of belief-value constellations," European Economic Review, Elsevier, vol. 172(C).
    5. Kaplan, Steven N. & Sørensen, Morten & Zakolyukina, Anastasia A., 2022. "What is CEO overconfidence? Evidence from executive assessments," Journal of Financial Economics, Elsevier, vol. 145(2), pages 409-425.
    6. Alice Soldà & Changxia Ke & William von Hippel & Lionel Page, 2021. "Absolute Versus Relative Success : Why Overconfidence Creates an Inefficient Equilibrium," Post-Print hal-04850419, HAL.
    7. Banerjee, Ritwik & Gupta, Nabanita Datta & Villeval, Marie Claire, 2020. "Feedback spillovers across tasks, self-confidence and competitiveness," Games and Economic Behavior, Elsevier, vol. 123(C), pages 127-170.
    8. Jeroen Nieboer, 2022. "Positional enhancement in effort-based social comparisons," Discussion Papers 2022-02, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    9. Hagenbach, Jeanne & ,, 2022. "Motivated Skepticism," CEPR Discussion Papers 17478, C.E.P.R. Discussion Papers.
    10. Soldà, Alice & Ke, Changxia & von Hippel, William & Page, Lionel, 2021. "Absolute vs. relative success: Why overconfidence is an inefficient equilibrium," Working Papers 0700, University of Heidelberg, Department of Economics.
    11. Burro, Giovanni & Castagnetti, Alessandro, 2024. "The ego is no fool: Absence of motivated belief formation in strategic interactions," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 109(C).
    12. Lata Gangadharan & Philip J. Grossman & Nina Xue, 2022. "Stepping Stone: Identifying self-image concerns from motivated beliefs: Does it matter how and whom you ask?," Monash Economics Working Papers 2022-05, Monash University, Department of Economics.
    13. Gangadharan, Lata & Grossman, Philip J. & Xue, Nina, 2024. "Belief elicitation under competing motivations: Does it matter how you ask?," European Economic Review, Elsevier, vol. 169(C).
    14. Friehe, Tim & Pannenberg, Markus, 2021. "Time preferences and overconfident beliefs: Evidence from germany," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 92(C).
    15. Anton Suvorov & Jeroen van de Ven & Marie Claire Villeval, 2024. "Selective Information Sharing and Group Delusion," Working Papers 2405, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
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    17. Haeussler, Carolin & Vieth, Sabrina, 2022. "A question worth a million: The expert, the crowd, or myself? An investigation of problem solving," Research Policy, Elsevier, vol. 51(3).
    18. Sharma, Karmini & Castagnetti, Alessandro, 2023. "Demand for information by gender: An experimental study," Journal of Economic Behavior & Organization, Elsevier, vol. 207(C), pages 172-202.
    19. Flores, Lia Q. & Fonseca, Miguel A., 2024. "Do in-group biases lead to overconfidence in performance? Experimental evidence," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 111(C).

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    More about this item

    Keywords

    Overconfidence; motivated cognition; self-deception; persuasion; information sampling; experiment;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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