Own experience bias in evaluating the efforts of others

Date

2020-04-06

Advisors

Journal Title

Journal ISSN

ISSN

0167-2681

Volume Title

Publisher

Elsevier

Type

Article

Peer reviewed

Yes

Abstract

We develop a model with which to explore how an individuals own experience in the labor market may influence her assessment of the efforts of other individuals. Specifically, we consider a two stage process in which individuals first learn, through experience, whether effort is rewarded and then subsequently have to estimate the effort of others. We derive a theoretical benchmark based on rational inference and then explore how own experience may lead to systematic bias from this benchmark. Our theoretical results suggest that those who are not rewarded for high effort will underestimate the effort of other individuals while those for whom effort is rewarded will (slightly) overestimate the effort of others. We empirically test and confirm this prediction in the lab.

Description

The file attached to this record is the author's final peer reviewed version. The Publisher's final version can be found by following the DOI link.

Keywords

bayesian updating, own experience, attribution error, false consensus

Citation

Cartwright, E., and Wooders, M. (2020) Own experience bias in evaluating the efforts of others. Journal of Economic Behavior & Organization, 173, pp.164-178.

Rights

Research Institute

Institute for Applied Economics and Social Value (IAESV)