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False Consensus in Economic Agents

Author

Listed:
  • Proto, Eugenio

    (Department of Economics, University of Warwick)

  • Sgroi, Daniel

    (Department of Economics, University of Warwick)

Abstract

In an incentivized experiment we identify a powerful and ubiquitous bias: individuals regard their own characteristics and choices as more common than is the case. We establish this "false consensus" bias in terms of happiness, political stance, mobile phone brand and on the attitude to deference in a hypothetical restaurant choice, and show that it is not limited to the distribution of hard to observe characteristics and choices but also to weight and height. We also show that the bias is not driven by the fact that the tallest, happiest, most left/right-wing, etc. are more salient. Key words: false consensus ; saliency ; biased beliefs ; happiness ; politics ; height, weight. JEL classification: D03 ; C83 ; D84

Suggested Citation

  • Proto, Eugenio & Sgroi, Daniel, 2011. "False Consensus in Economic Agents," The Warwick Economics Research Paper Series (TWERPS) 968, University of Warwick, Department of Economics.
  • Handle: RePEc:wrk:warwec:968
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    File URL: https://warwick.ac.uk/fac/soc/economics/research/workingpapers/2011/twerp_968.pdf
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    References listed on IDEAS

    as
    1. Oswald, Andrew J., 2008. "On the curvature of the reporting function from objective reality to subjective feelings," Economics Letters, Elsevier, vol. 100(3), pages 369-372, September.
    2. Burks, Stephen V. & Carpenter, Jeffrey P. & Götte, Lorenz & Rustichini, Aldo, 2010. "Overconfidence is a Social Signaling Bias," IZA Discussion Papers 4840, Institute for the Study of Labor (IZA).
    3. Dirk Engelmann & Martin Strobel, 2000. "The False Consensus Effect Disappears if Representative Information and Monetary Incentives Are Given," Experimental Economics, Springer;Economic Science Association, vol. 3(3), pages 241-260, December.
    4. Sergio Currarini & Matthew O. Jackson & Paolo Pin, 2009. "An Economic Model of Friendship: Homophily, Minorities, and Segregation," Econometrica, Econometric Society, vol. 77(4), pages 1003-1045, July.
    5. Becker, Gary S, 1973. "A Theory of Marriage: Part I," Journal of Political Economy, University of Chicago Press, vol. 81(4), pages 813-846, July-Aug..
    6. Roland Bénabou & Jean Tirole, 2002. "Self-Confidence and Personal Motivation," The Quarterly Journal of Economics, Oxford University Press, vol. 117(3), pages 871-915.
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. On false consensus
      by chris dillow in Stumbling and Mumbling on 2014-10-28 19:11:06

    More about this item

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations

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