Excess entry, ambiguity seeking and competence: An experimental investigation

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.

Special investigation of the City of Center Point Library for the period January 1, 2006 through December 6, 2007

Special investigation of the City of Center Point Library for the period January 1, 2006 through December 6, 2007

Special investigation of the City of Schleswig for the period January 1, 2003 through January 31, 2007

Special investigation of the City of Schleswig for the period January 1, 2003 through January 31, 2007

How wide is the gap? An investigation of gender wage differences using quantile regression

In this paper we examine the determinants of wages and decompose theobserved differences across genders into the "explained by differentcharacteristics" and "explained by different returns components"using a sample of Spanish workers. Apart from the conditionalexpectation of wages, we estimate the conditional quantile functionsfor men and women and find that both the absolute wage gap and thepart attributed to different returns at each of the quantiles, farfrom being well represented by their counterparts at the mean, aregreater as we move up in the wage range.

Does money matter in shaping domestic business cycles? An international investigation (with appendices)

We study the contribution of money to business cycle fluctuations in the US,the UK, Japan, and the Euro area using a small scale structural monetary business cycle model. Constrained likelihood-based estimates of the parameters areprovided and time instabilities analyzed. Real balances are statistically importantfor output and inflation fluctuations. Their contribution changes over time. Models giving money no role provide a distorted representation of the sources of cyclicalfluctuations, of the transmission of shocks and of the events of the last 40 years.

Special investigation of the City of Searsboro for the period July 1, 2000 through October 9, 2006

Special investigation of the City of Searsboro for the period July 1, 2000 through October 9, 2006

Special investigation of the City of Grinnell Police Department for the period January 1, 2006 through April 30, 2008

Special investigation of the City of Grinnell Police Department for the period January 1, 2006 through April 30, 2008

Special investigation of the City of Vinton Parks and Recreation Department for the period July 19, 2001 through August 30, 2007

Special investigation of the City of Vinton Parks and Recreation Department for the period July 19, 2001 through August 30, 2007

Special investigation of selected transactions at Perry High School for the period July 1, 2005 through November 30, 2007

Special investigation of selected transactions at Perry High School for the period July 1, 2005 through November 30, 2007

Report on a special investigation of the West Marshall Community School District for the period January 1, 2001 through June 30, 2007

Report on a special investigation of the West Marshall Community School District for the period January 1, 2001 through June 30, 2007

Report on a special investigation of the City of Durant for the period July 1, 2000 through May 6, 2008

Report on a special investigation of the City of Durant for the period July 1, 2000 through May 6, 2008

Did colonization matter for growth? An empirical exploration into the historical causes of Africa's underdevelopment

We investigate the impact of 20th--century European colonizationon growth in Africa. We find that in the 1960--88 period growth has beenfaster for dependencies than for colonies; for British and Frenchcolonies than for Portuguese, Belgian and Italian ones; and for countrieswith less economic penetration during the colonial period. On average,African growth accelerates after decolonization. Proxies for colonialheritage add explanatory power to growth regressions and make indicatorsfor human capital, political and ethnic instability lose significance.Colonial variables capture the same effects of a sub--Saharan dummy andreduce its significance when jointly included in a cross sectionalregression with 98 countries.

Forward induction and the excess capacity puzzle: An experimental investigation

While the theoretical industrial organization literature has long arguedthat excess capacity can be used to deter entry into markets, there islittle empirical evidence that incumbent firms effectively behave in thisway. Bagwell and Ramey (1996) propose a game with a specific sequence ofmoves and partially-recoverable capacity costs in which forward inductionprovides a theoretical rationalization for firm behavior in the field. Weconduct an experiment with a game inspired by their work. In our data theincumbent tends to keep the market, in contrast to what the forwardinduction argument of Bagwell and Ramey would suggest. The results indicatethat players perceive that the first mover has an advantage without havingto pre-commit capacity. In our game, evolution and learning do not driveout this perception. We back these claims with data analysis, atheoretical framework for dynamics, and simulation results.

Report on a special investigation of the City of Macedonia for the period June 26, 2006 through September 30, 2008

Report on a special investigation of the City of Macedonia for the period June 26, 2006 through September 30, 2008