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Title:Belief updating among college students: Evidence from experimental variation in information PDF Logo
Authors:Wiswall, Matthew
Zafar, Basit
Issue Date:2011
Series/Report no.:Staff Report, Federal Reserve Bank of New York 516
Abstract:We investigate how college students form and update their beliefs about future earnings using a unique information experiment. We provide college students true information about the population distribution of earnings and observe how this information causes respondents to update their beliefs about their own future earnings. We show that college students are substantially misinformed about population earnings and logically revise their self-beliefs in response to the information we provide, with larger revisions when the information is more specific and is good news. We classify the updating behaviors observed and find that the majority of students are non-Bayesian updaters.
Subjects:belief updating
college majors
information
uncertainty
subjective expectations
Bayesian updating
JEL:D81
D83
D84
I21
I23
J10
Document Type:Working Paper
Appears in Collections:Staff Reports, Federal Reserve Bank of New York

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