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The Dynamics of Overconfidence: Evidence from Stock Market Forecasters

Author

Listed:
  • Richard Deaves

    (McMaster University [Hamilton, Ontario], Center for European Economic Research (ZEW) - Center for European Economic Research (ZEW))

  • Erik Lüders
  • Michael Schröder

    (Center for European Economic Research (ZEW) - Center for European Economic Research (ZEW))

Abstract

As a group, market forecasters are overconfident in the sense that they are miscalibrated. While overconfidence is persistent, respondents do exhibit some degree of rational learning in that they widen confidence intervals after failure as much as they narrow them after success. Market experience exacerbates overconfidence, primarily through knowledge deterioration.

Suggested Citation

  • Richard Deaves & Erik Lüders & Michael Schröder, 2010. "The Dynamics of Overconfidence: Evidence from Stock Market Forecasters," Post-Print hal-00849407, HAL.
    • Handle: RePEc:hal:journl:hal-00849407
    DOI: 10.1016/j.jebo.2010.05.001
    Note: View the original document on HAL open archive server: https://hal.science/hal-00849407v1
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    References listed on IDEAS

    as
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