Empirical Tests of Non-standard Preferences for Beliefs and Information
type: CreativeWork
description: This thesis consists of three chapters that conduct empirical tests of behavioural microeconomic theory. The first is a study of observational data, using reduced form and structural models, and the other two are based on laboratory experiments. The connecting thread between all three chapters is their focus on preferences for beliefs and information. Chapter 1, Biased Recall and The Dynamics of Beliefs: Evidence From Schools, uses reduced form and structural methods to test theories of motivated beliefs in the field. These theories predict biased recall of ego-relevant information and thus provide a compelling explanation for persistent overconfidence in a variety of contexts. However, they have remained largely untested in the field until very recently. This chapter does so in a critical context for the formation of beliefs about ability: schooling. Using within-individual variation, the analysis finds evidence of typical patterns of recall consistent with motivated beliefs theory: recall of grades is biased and becomes more biased as time passes, and biased recall is associated with overconfidence about future grades. A structural model is then estimated. The model allows for unobserved heterogeneity in tastes for biased recall, revealing large differences across types of students. The model is used to simulate the effects of an informational intervention correcting biases in recall, finding that it would reduce student welfare and widen existing attainment gaps. Chapter 2, Recall Distortion and Past Choices, inherits Chapter 1’s focus on recall and memory and marks the beginning of the part of the thesis that focuses on experiments. It is joint work with Rebecca Heath. The basic question addressed by this chapter is whether beliefs are distorted to enable optimism about the consequences of past choices. The experiment finds support for this hypothesis and obtains suggestive evidence that belief distortions increase after a few days due to memory loss. This has i…
abstract: This thesis consists of three chapters that conduct empirical tests of behavioural microeconomic theory. The first is a study of observational data, using reduced form and structural models, and the other two are based on laboratory experiments. The connecting thread between all three chapters is their focus on preferences for beliefs and information. Chapter 1, Biased Recall and The Dynamics of Beliefs: Evidence From Schools, uses reduced form and structural methods to test theories of motivated beliefs in the field. These theories predict biased recall of ego-relevant information and thus provide a compelling explanation for persistent overconfidence in a variety of contexts. However, they have remained largely untested in the field until very recently. This chapter does so in a critical context for the formation of beliefs about ability: schooling. Using within-individual variation, the analysis finds evidence of typical patterns of recall consistent with motivated beliefs theory: recall of grades is biased and becomes more biased as time passes, and biased recall is associated with overconfidence about future grades. A structural model is then estimated. The model allows for unobserved heterogeneity in tastes for biased recall, revealing large differences across types of students. The model is used to simulate the effects of an informational intervention correcting biases in recall, finding that it would reduce student welfare and widen existing attainment gaps. Chapter 2, Recall Distortion and Past Choices, inherits Chapter 1’s focus on recall and memory and marks the beginning of the part of the thesis that focuses on experiments. It is joint work with Rebecca Heath. The basic question addressed by this chapter is whether beliefs are distorted to enable optimism about the consequences of past choices. The experiment finds support for this hypothesis and obtains suggestive evidence that belief distortions increase after a few days due to memory loss. This has i…
author: Roy-Chowdhury, Vivek
language: eng
keywords: behavioural economics, beliefs, microeconomic theory, self-control, information, education, recall
license: https://apollo8-f-pro.lib.cam.ac.uk/bitstreams/db5de74a-d53b-4f68-9031-430d53cfb2a6/download
license: https://www.rioxx.net/licenses/all-rights-reserved/
date published: 2024-06-24
date modified: 2026-07-22T22:24:25Z
provider: Cambridge University
publisher: Networked Digital Library of Theses and Dissertations
type: WebPage
source organization: University of Cambridge

PropertyValue
property ID: DOI
value: 10.17863/CAM.114115