International College of Economics and Finance

Research Seminar by Gigi Foster (UNSW Australia Business School)

On Wednesday, June 10 at 4.40 pm, room 3211 (Shabolovka st., 26) ICEF held the Research Seminar.
Speaker: Gigi Foster (UNSW Australia Business School)
Theme: "The Happiness of Self-Delusion: Theory and Evidence"

Abstract: We propose and test a simple new theory for one of the more puzzling findings in happiness economics in recent years: that respondents derive happiness from overoptimistic expectations (Senik 2008), and for instance see their happiness rise far more than would be expected when share prices increase (Ratcliffe & Taylor 2012, Deaton 2012). We suggest that over-optimism is related to both happiness and choices, and try to find an evolutionary rationale for this relationship. Our enhanced happiness model includes an explicit role for over-optimism as a means of motivating ourselves to make higher investments into future outcomes, and as a means of deluding ourselves so as to more convincingly lie about our quality to prospective mates. We use unique survey data to verify our predictions that work effort, caring about the future, and over-optimism are all positively related. Finally, we explore the implications of our theory for the optimal information-revelation policy of fully-informed principals.

Everyone interested is welcome to attend!

Pass can be ordered by:
tel. (495)772-95-90*26090
contact: Zheleznov Slava 

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