Abstract
To understand why naivete about present-biased behavior is so prevalent and persistent, our experiment investigates how well participants learn from their past behavior in a real-effort task. While participants display naive present-biased behavior initially, our novel methodology allows us to establish that their updating is unbiased and would eliminate naivete in the long run. Moreover, learning is unencumbered by a change in the environment. Our results suggest that persistent naivete does not result from a fundamental inferential bias. However, participants underestimate their future learning-a bias that may lead to underinvestment in experimentation and a failure to activate self-regulation mechanisms.
Item Type: | Journal article |
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Faculties: | Munich School of Management |
Subjects: | 300 Social sciences > 330 Economics |
ISSN: | 1542-4766 |
Language: | English |
Item ID: | 115225 |
Date Deposited: | 02. Apr 2024, 08:11 |
Last Modified: | 02. Apr 2024, 08:11 |