Powdthavee, Nattavudh and Riyanto, Yohanes E. (2012) Why do people pay for useless advice? CEP Discussion Papers (CEPDP1153). London School of Economics and Political Science. Centre for Economic Performance, London, UK.
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Abstract
We investigated experimentally whether people can be induced to believe in a non-existent expert, and subsequently pay for what can only be described as transparently useless advice about future chance events. Consistent with the theoretical predictions made by Rabin (2002) and Rabin and Vayanos (2010), we show empirically that the answer is yes and that the size of the error made systematically by people is large.
| Item Type: | Monograph (Discussion Paper) |
|---|---|
| Official URL: | https://cep.lse.ac.uk/_new/publications/discussion... |
| Additional Information: | © 2012 The Author(s) |
| Divisions: | Centre for Economic Performance |
| Subjects: | H Social Sciences > HC Economic History and Conditions |
| JEL classification: | C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C91 - Laboratory, Individual Behavior D - Microeconomics > D0 - General > D00 - General |
| Date Deposited: | 22 Feb 2024 10:09 |
| Last Modified: | 14 Sep 2024 04:45 |
| URI: | http://eprints.lse.ac.uk/id/eprint/121779 |
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