Replication data for: The Origin of the Winner's Curse: A Laboratory Study

Principal Investigator(s):  View help for Principal Investigator(s) Gary Charness; Dan Levin

Version:  View help for Version V1

Name File Type Size Last Modified
LICENSE.txt text/plain 14.6 KB 10/12/2019 06:10:PM
final_origin_aej.xls application/vnd.ms-excel 2.7 MB 10/12/2019 06:10:PM
read_me_aej.pdf application/pdf 34.2 KB 10/12/2019 06:10:PM

Project Citation: 

Charness, Gary, and Levin, Dan. Replication data for: The Origin of the Winner’s Curse: A Laboratory Study. Nashville, TN: American Economic Association [publisher], 2009. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E114313V1

Project Description

Summary:  View help for Summary The Winner's Curse (WC) is a robust and persistent deviation from theoretical predictions established in experimental economics and claimed to exist in field environments. Recent attempts to reconcile such deviation include "cursed equilibrium" and level-k reasoning. We design and implement a simplified version of the Acquiring-a-Company game that transformed the game to an individual-choice problem that still retains the adverse-selection problem. We further simplified the problem so that simple ordinal reasoning could replace both Bayesian updating and contingent thinking. Our results suggest that the WC reflects bounded rationality in that people have difficulties performing contingent reasoning on future events. (JEL D81, D82)

Scope of Project

JEL Classification:  View help for JEL Classification
      D81 Criteria for Decision-Making under Risk and Uncertainty
      D82 Asymmetric and Private Information; Mechanism Design


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V1 [2019-10-12]

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