New Economics Papers
on Neuroeconomics
Issue of 2013‒08‒10
two papers chosen by

  1. Decision time and steps of reasoning in a competitive market entry game By Florian Lindner
  2. Personality Traits and the Perception of Macroeconomic Indicators – Survey Evidence By Andreas Orland

  1. By: Florian Lindner
    Abstract: Entry decisions in market entry games usually depend on the belief about how many others are entering the market, the belief about the own rank in a real effort task, and subjects' risk preferences. In this paper I am able to replicate these basic results and examine two further dimensions: (i) the level of strategic sophistication, which has a positive impact on entry decisions, and (ii) the impact of time pressure, which has a (partly) negative influence on entry rates. Furthermore, when ranks are determined using a real effort task, differences in entry rates are explainable by higher competitiveness of males. Additionally, I show that individual characteristics are more important for the entry decision in more competitive environments.
    Keywords: Market entry game, Time pressure, Level-k reasoning, Risk, Competitiveness, Experiment
    JEL: C72 C91 D81
    Date: 2013–07
  2. By: Andreas Orland
    Abstract: I examine the determinants of both perceived inflation and unemployment in one single survey and include personality traits (BFI-S) in the analysis. This is the first survey on this topic in Germany. My sample consists of 1,771 students from different fields and levels. Using PhD students’ estimates as a reference, I create categories for underestimation and overestimation of both variables. Multinomial logit regressions show that females overestimate both variables. Education and news consumption reduce misestimation. A higher level of Neuroticism is related with a higher probability to overestimate unemployment. Overstating (understating) one indicator is associated with overstating (understating) the other.
    Keywords: Survey; inflation perception; unemployment perception; personality traits; cross-sectional heterogeneity
    JEL: C20 D12
    Date: 2013–07

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