Beiträge zur Jahrestagung des Vereins für Socialpolitik 2019: 30 Jahre Mauerfall - Demokratie und Marktwirtschaft - Session: Experimental Economics VI No. E06-V1
Many papers have reported behavioral biases in belief formation that come on top of standard game-theoretic reasoning. We show that the processes involved depend on the way participants reason about their beliefs. When they think about what everybody else or another "unspeci€fied" individual is doing, they exhibit a consensus bias (believing that others are similar to themselves). In contrast, when they think about what their situation-speci€c counterpart is doing, they show ex-post rationalization, under which the reported belief is €‹ed to the action and not vice versa. Our €ndings suggest that there may not be an "innocent" belief-elicitation method that yields unbiased beliefs. However, if we "debias" the reported beliefs using our estimates of the di‚fferent eff‚ects, we €find no more treatment eff‚ect of how we ask for the belief. ‘The "debiasing" exercise shows that not accounting for the biases will typically bias estimates of game-theoretic thinking upwards.