Excess entry, ambiguity seeking and competence: An experimental investigation

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Grieco, Daniela; Hogarth, Robin. Excess entry, ambiguity seeking and competence: An experimental investigation. 2004
To cite or link this document: http://hdl.handle.net/10230/638
dc.contributor.author Grieco, Daniela
dc.contributor.author Hogarth, Robin
dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
dc.date.issued 2004-10-01
dc.identifier.uri http://hdl.handle.net/10230/638
dc.description.abstract Excess entry refers to the high failure rate of new entrepreneurial ventures. Economic explanations suggest 'hit and run' entrants and risk-seeking behavior. A psychological explanation is that people (entrepreneurs) are overconfident in their abilities (Camerer & Lovallo, 1999). Characterizing entry decisions as ambiguous gambles, we alternatively suggest?following Heath and Tversky (1991)?that people seek ambiguity when the source of uncertainty is related to their competence. Overconfidence, as such, plays no role. This hypothesis is confirmed in an experimental study that also documents the phenomenon of reference group neglect. Finally, we emphasize the utility that people gain from engaging in activities that contribute to a sense of competence. This is an important force in economic activity that deserves more explicit attention.
dc.language.iso eng
dc.relation.ispartofseries Economics and Business Working Papers Series; 778
dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.title Excess entry, ambiguity seeking and competence: An experimental investigation
dc.type info:eu-repo/semantics/workingPaper
dc.date.modified 2016-06-04T02:50:46Z
dc.subject.keyword Behavioral and Experimental Economics
dc.subject.keyword competence
dc.subject.keyword excess entry
dc.subject.keyword entrepreneurship
dc.subject.keyword overconfidence
dc.subject.keyword leex
dc.rights.accessRights info:eu-repo/semantics/openAccess

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