Abstrakt
The first chapter offers a theoretical model that suggests an alternative explanation to the so-called unskilled-and-unaware problem-the unskilled overestimate their skills while the skilled underestimate (but less than the unskilled). The unskilled-and-unaware problem was experimentally identified about a decade ago and numerous authors have elaborated on this problem since.
We propose that the alleged unskilled-and-unaware problem, rather than being one of biased judgments, is a signal extraction problem that differs for the skilled and the unskilled. The second chapter reports the results of three experiments (one field, two laboratory) through which we tested the theoretical model and some informal extensions.
Specifically, we examine the impact of general information and specific information (feedback) on the quality of absolute and relative self-assessment ("calibration") in various tasks (microeconomics exam, skill-oriented task, and general-knowledge oriented task). In our experiments, we used a specific subject pool-CERGE-EI preparatory semester students who are competitively selected students from their home universities around Central and Eastern Europe.
Overconfidence behavior initially prevails in almost all settings. We find a strong positive effect of general information on calibration.
We also show that calibration improves more when feedback is provided. Moreover, our results suggest that the absolute self-assessment is more responsive to information.
The third chapter reviews, categorizes, and evaluates experimental studies on overconfidence and self-assessment in business, economics, and finance. First, we review the main results of experimental research in psychology and highlight the main issues in psychology as well as current issues in economics.
Then we create a non-opportunistic set of experimental studies from business, economics, and finance concerning overconfidence or self-assessment.