Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/92386
Authors: 
Herz, Holger
Schunk, Daniel
Zehnder, Christian
Year of Publication: 
2013
Series/Report no.: 
Working Paper Series, University of Zurich, Department of Economics 106 [rev.]
Abstract: 
Recent field evidence suggests a positive link between overconfidence and innovative activities. In this paper we argue that the connection between overconfidence and innovation is more complex than the previous literature suggests. In particular, we show theoretically and experimentally that different forms of overconfidence may have opposing effects on innovative activity. While overoptimism is positively associated with innovation, judgmental overconfidence is negatively linked to innovation. Our results indicate that future research is well advised to take into account that the relationship between innovation and overconfidence may crucially depend on what type of overconfidence is most prevalent in a particular context.
Subjects: 
Innovation
Entrepreneurship
Overconfidence
Experiment
JEL: 
C92
D83
D23
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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