Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/60900 
Year of Publication: 
2011
Series/Report no.: 
Staff Report No. 516
Publisher: 
Federal Reserve Bank of New York, New York, NY
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

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