New Economics Papers
on Neuroeconomics
Issue of 2011‒10‒09
four papers chosen by

  1. Age at pubertal onset and educational outcomes By Dreber, Anna; von Essen, Emma; Ranehill, Eva
  2. Overconfidence and team-performance: An analysis of NBA-players' self-perception By Geyer, Hannah; Wickhorst, Hanke
  3. Coping with unpleasant surprises in a complex world: Is rational choice possible in a world with positive information costs? By Congleton, Roger D.
  4. Testing the Framework of Other-Regarding Preferences By M. Vittoria Levati; Aaron Nicholas; Birendra Rai

  1. By: Dreber, Anna (Institute for Financial Research (SIFR), Stockholm); von Essen, Emma (Dept. of Economics, Stockholm University); Ranehill, Eva (Stockholm School of Economics)
    Abstract: Education has important short and long run implications for individual outcomes. In this paper we explore the association between age at pubertal onset and educational outcomes in a sample of Swedish girls. Previous research suggests that girls that mature earlier perform worse in school compared to girls that mature later. To test if this is also true among Swedish girls, we investigate the association between pubertal development and grades, educational aspirations and educational choice. We also investigate whether changes in risk attitudes, time preferences and priorities concerning school versus friends mediate this potential correlation. We confirm that earlier maturing girls have lower grades and lower educational aspirations, but find that they make educational choices similar to those of later maturing girls. Furthermore, we do not find that these differences in grades and aspirations are mediated by risk attitudes, time preferences or priorities.
    Keywords: educational outcomes; puberty; pubertal timing; grades
    JEL: I00 J10 J16
    Date: 2011–09–27
  2. By: Geyer, Hannah; Wickhorst, Hanke
    Abstract: We analyse the effect of overconfidence in a model of team-production with effort complementarities. We show that overconfidence may not only enhance an overconfident agent's effort but also that of a rational one. Focusing the agents' payoffs we see that this increase in effort can be to the agents' benefit, regardless whether they are rational or overconfident. We take this notion to NBA-data which we have gained from the season 2009/10 and see that players who have been identified as overconfident have a significantly positive effect on their team's success. -- Wir betrachten den Effekt von Overconfidence mit Hilfe eines intuitiven Modells einer Team-Produktion mit komplementären Arbeitseinsätzen. Es zeigt sich, dass Overconfidence nicht nur den Arbeitseinsatz des betroffenen Agenten erhöht, sondern gleichzeitig den eines rationalen Teammitglieds. Hieraus resultiert ein Nutzenvorteil für die Agenten, unabhängig davon, ob sie selbst rational oder overconfident sind. Daten der NBA-Saison von 2009/10 zeigen, dass Spieler, welche als overconfident identifiziert wurden, einen signifikant positiven Effekt auf den Erfolg ihres Teams haben.
    JEL: D21 D62 L23
    Date: 2011
  3. By: Congleton, Roger D.
    Abstract: This paper provides a rational choice-based analysis of the causes and consequences of surprise events. The paper argues that ignorance may be rational, but nonetheless produce systematic mistakes, inconsistent behavior, and both pleasant and unpleasant surprises. If ignorance and unpleasant surprises are commonplace and relevant for individual and group decisionmaking, we should observe standing institutions for dealing with them - and we do. Insofar as surprises are consistent with rational choice models, but left outside most models, it can be argued that these methodological choices mistakenly limit the scope of rational choicebased research. --
    Keywords: Ignorance,Rational Ignorance,Natural Ignorance,Bounded Rationality,Rational Choice,Biased Expectations,Crisis Management,Social Insurance,Bailouts,Economics of Information
    JEL: D8 D6
    Date: 2011
  4. By: M. Vittoria Levati (Max Planck Institute of Economics, Jena, and Department of Economics, University of Verona); Aaron Nicholas (Graduate School of Business, Deakin University); Birendra Rai (Department of Economics, Monash University)
    Abstract: We assess the empirical validity of the overall theoretical framework of other-regarding preferences by focusing on those preference axioms that are common to all the prominent theories of outcome-based other-regarding preferences. This common set of preference axioms leads to a testable implication: the strict preference ranking of self over a finite number of alternatives lying on any straight line in the space of material payoffs to self and other will be single-peaked. The extent of single-peakedness varies from a high of 79% to a low of 54% across our treatments that are based on dictator and trust games. Positively and/or negatively other-regarding subjects are significantly less likely to report single-peaked rankings relative to self-regarding subjects. We delineate the potential reasons for violations of single-peakedness and discuss the implications of our findings for theoretical modeling of other-regarding preferences.
    Keywords: Other-regarding preferences, social preferences, decision making under risk, single-peaked preferences, experiments
    JEL: C70 C91 D63 D81
    Date: 2011–09–30

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