Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/100543 
Authors: 
Year of Publication: 
2014
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2014: Evidenzbasierte Wirtschaftspolitik - Session: Behavioral Economics No. D10-V2
Publisher: 
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft, Kiel und Hamburg
Abstract: 
The psychology literature provides ample evidence that people have difficulties taking the perspective of less informed others. This paper presents a controlled experiment showing that this "curse of knowledge" can cause comparative overconfidence and overentry into competition. In a broader context, the results provide an explanation for the overconfidence of nascent entrepreneurs and the substantial rate of failure among new businesses.
Subjects: 
curse of knowledge
hindsight bias
information projection
overconfidence
sorting
incentive schemes
competition
beliefs
experiments
JEL: 
C91
D80
D82
D83
D84
Document Type: 
Conference Paper

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