On the Evolution of Overconé dence and Entrepreneurs

@inproceedings{Bernardo2001OnTE,
  title={On the Evolution of Overcon{\'e} dence and Entrepreneurs},
  author={Antonio Bernardo and Ivo Welch},
  year={2001}
}
This paper explains why seemingly irrational overconŽdent behavior can persist. Information aggregation is poor in groups in which most individuals herd. By ignoring the herd, the actions of overconŽdent individuals (“entrepreneurs”) convey their private information. However, entrepreneurs make mistakes and thus die more frequently. The socially optimal proportion of entrepreneurs trades off the positive information externality against high attrition rates of entrepreneurs, and depends on the… CONTINUE READING

Citations

Publications citing this paper.

FILTER CITATIONS BY YEAR

2001
2019

CITATION STATISTICS

  • 15 Highly Influenced Citations

  • Averaged 6 Citations per year over the last 3 years

References

Publications referenced by this paper.
SHOWING 1-10 OF 39 REFERENCES

An Adaptive Theory of Self Deception,

  • D. Hirshleifer
  • Working Paper, University of Michigan, Graduate…
  • 1997
Highly Influential
4 Excerpts

OverconŽdence, Investor Sentiment, and Evolution,

  • A. Wang
  • Working Paper, Rice University; Journal of…
  • 2001
2 Excerpts

Similar Papers

Loading similar papers…