Overconfidence over the lifespan: Evidence from Germany

Friehe, Tim; Pannenberg, Markus

doi:10.1016/j.joep.2019.102207

Cited by 41 publications

(18 citation statements)

References 81 publications

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“…sures, absolute and relative health perception biases, whose empirical measurement we borrow from the growing literature on overconfidence (c.f. Tiefenbeck et al, 2018;Friehe and Pannenberg, 2019). Absolute perception biases are biased perceptions of own health, whereas relative perception biases are biased perceptions relative to population health.…”

Section: Introductionmentioning

confidence: 99%

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Biased health perceptions and risky health behaviors—Theory and evidence

Arni

Dragone

Göette

et al. 2021

Journal of Health Economics

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This paper investigates the role of biased health perceptions as driving forces of risky health behavior. We define absolute and relative health perception biases, illustrate their measurement in surveys and provide evidence on their relevance. Next, we decompose the theoretical effect into its extensive and intensive margin: When the extensive margin dominates, people (wrongly) believe they are healthy enough to "afford" unhealthy behavior. Finally, using three population surveys, we provide robust empirical evidence that respondents who overestimate their health are less likely to exercise and sleep enough, but more likely to eat unhealthily and drink alcohol daily.

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Section: Introductionmentioning

confidence: 99%

“…This survey question has been successfully tested in other contexts. For example, using the same format, respondents in the Swiss "Amphiro" study were asked about their income position, their water use, and their knowledge of energy conservation(Tiefenbeck et al, 2018;Friehe and Pannenberg, 2019).…”

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confidence: 99%

Biased health perceptions and risky health behaviors—Theory and evidence

Arni

Dragone

Göette

et al. 2021

Journal of Health Economics

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“…Gervais and Odean (2001) found that traders may learn to be overconfident not because they become better at trading but because they give credit of their success to overconfidence: "Overconfidence does not make traders wealthy, but the process of becoming wealthy can make traders overconfident". Merkle (2017) has corroborated the learning-to-be-overconfident hypothesis; Friehe and Pannenberg (2019) show that overconfidence increases with experience. Gentile et al (2016), for the Italian market, confirm that "Older and wealthier individuals are more likely to be overconfident".…”

Section: Crt and Cognitive Biasesmentioning

confidence: 60%

The Impact of Cognitive Skills on Investment Decisions: An Empirical Assessment and Policy Suggestions

Esposito

Lorenzo

2021

SSRN Journal

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“…Put differently, in a class of 100 students, the student with the 50 th rank always has the median performance, regardless of whether the class as a whole is weak or strong. Our measure of overplacement is commonly used in research on confidence (e.g., C. Anderson et al, 2012;Belmi, Neale, Reiff, & Ulfe, 2019;Ehrlinger, Mitchum, & Dweck, 2016;Emich, 2014;Friehe & Pannenberg, 2019;Muthukrishna et al, 2018). To calculate discrepancy between self-estimated placement and actual placement, we simply subtracted actual from estimated placement; but for tests of covariation involving overplacement, we used the residuals when regressing selfestimated placement on actual placement, which capture aspects of beliefs that cannot be explained by true performance, consistent with existing approaches (C. Anderson et al, 2012;Cronbach & Furby, 1970;Dubois, 1957;John & Robins, 1994a; see Supplemental Materials for expanded discussion on calculating discrepancy).…”

Section: Materials and Procedurementioning

confidence: 99%

The social transmission of overconfidence.

Cheng¹,

Anderson²,

Tenney³

et al. 2021

Journal of Experimental Psychology: General

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We propose and test the overconfidence transmission hypothesis, which predicts that individuals calibrate their self-assessments in response to the confidence others display in their social group. Six studies that use a mix of correlational and experimental methods support this hypothesis. Evidence indicates that individuals randomly assigned to collaborate in laboratory dyads converged on levels of overconfidence about their own performance rankings. In a controlled experimental context, observing overconfident peers causally increased an individual's degree of bias. The transmission effect persisted over time and across task domains, elevating overconfidence even days after initial exposure. In addition, overconfidence spread across indirect social ties (person to person to person), and transmission operated "stealthily," outside of reported awareness. However, individuals showed a selective in-group bias; overconfidence was acquired only when cued by a member of one's in-group (and not out-group), consistent with theoretical notions of selective learning bias. Combined, these results advance understanding of the social factors that underlie inter-individual differences in overconfidence, and suggest that social transmission processes may be in part responsible for why local "confidence traditions" emerge in groups, teams, and organizations.

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Overconfidence over the lifespan: Evidence from Germany

Cited by 41 publications

References 81 publications

Biased health perceptions and risky health behaviors—Theory and evidence

Biased health perceptions and risky health behaviors—Theory and evidence

The Impact of Cognitive Skills on Investment Decisions: An Empirical Assessment and Policy Suggestions

The social transmission of overconfidence.

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