Confidence Enhanced Performance

27 Pages Posted: 13 Feb 2002

See all articles by Olivier Compte

Olivier Compte

Paris School of Economics (PSE); Ecole Nationale des Ponts et Chaussées (ENPC) - Centre d'Enseignement et de Recherche en Analyse Socio-Economique (CERAS)

Andrew Postlewaite

University of Pennsylvania - Department of Economics

Date Written: December 2001

Abstract

There is ample evidence that confidence can affect performance: confidence can improve performance, while a lack of confidence may diminish it. For example. the fears induced by the possibility of failure or of negative evaluations have physiological consequences (shaking, loss of concentration) that may impair performance in sports, on stage or at school.

There is also ample evidence that individuals have distorted recollection of past events, distorted attributions of the causes of successes of failures. Recollection of good events or successes is typically easier than recollection of bad ones or failures. Successes tend to be attributed to intrinsic aptitudes or own effort, while failures are attributed to bad luck. In addition, these attributions are often reversed when judging the performance of others.

The objective of this paper is to reconcile the two phenomena described above, and show that in a world where performance depends on confidence biases in information processing can increase welfare.

Suggested Citation

Compte, Olivier and Postlewaite, Andrew, Confidence Enhanced Performance (December 2001). PIER Working Paper No. 01-057, Available at SSRN: https://ssrn.com/abstract=300422 or http://dx.doi.org/10.2139/ssrn.300422

Olivier Compte (Contact Author)

Paris School of Economics (PSE)

48 Boulevard Jourdan
Paris, 75014 75014
France

Ecole Nationale des Ponts et Chaussées (ENPC) - Centre d'Enseignement et de Recherche en Analyse Socio-Economique (CERAS) ( email )

28, rue des Saints-Peres
75007 Paris
France

Andrew Postlewaite

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States
215-898-7350 (Phone)
215-573-2057 (Fax)

HOME PAGE: http://www.econ.upenn.edu/~apostlew

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