Correspondence Bias

50 Pages Posted: 9 Jan 2021

See all articles by Yi Han

Yi Han

Renmin University of China - School of Applied Economics

Yiming Liu

Humboldt University of Berlin - School of Business and Economics; WZB Berlin Social Science Center

George Loewenstein

Carnegie Mellon University - Department of Social and Decision Sciences

Date Written: November 19, 2020

Abstract

When drawing inferences about a person’s personal characteristics from their actions, “correspondence bias” is the tendency to overestimate the influence of those characteristics and underestimate the influence of situational factors, such as incentives the individual faces. We build a simple framework to formalize correspondence bias, and test its predictions in an online experiment. Consistent with correspondence bias, subjects are, on average, willing to pay to receive the dictator-game givings of an individual with whom they are randomly assigned to play a game that encourages cooperation rather than one with whom they play a game that encourages selfish behavior. We show, further, that experiencing both games oneself, as opposed to playing one and observing the other, reduces the bias, and receiving information about how each of the players behaved in both games, eliminates it.

Keywords: Belief updating, Attribution bias, Incentives, Experiments

JEL Classification: C91, D90

Suggested Citation

Han, Yi and Liu, Yiming and Loewenstein, George F., Correspondence Bias (November 19, 2020). Available at SSRN: https://ssrn.com/abstract=3733326 or http://dx.doi.org/10.2139/ssrn.3733326

Yi Han

Renmin University of China - School of Applied Economics ( email )

59 Zhong Guan Cun Avenue
Hai Dian District
Beijing, 100872
China

Yiming Liu (Contact Author)

Humboldt University of Berlin - School of Business and Economics ( email )

Spandauer Str. 1
Berlin, D-10099
Germany

WZB Berlin Social Science Center ( email )

Reichpietschufer 50
Berlin, 10785
Germany

George F. Loewenstein

Carnegie Mellon University - Department of Social and Decision Sciences ( email )

Pittsburgh, PA 15213-3890
United States
412-268-8787 (Phone)
412-268-6938 (Fax)

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