Search and confidence

Why do ugly men chat up good-looking women when better looking ones don't? Why do idiots sometimes get good jobs whilst smarter people don't? Why don't the long-term unemployed look harder for jobs? Why are women under-represented in "top jobs"?
These questions might have a common solution. It's all to do with self-confidence in the search process, as a clever experiment described in this paper shows.
The authors set subjects a maths test and told the subjects the result of their own test, but not others, so subjects were uncertain of their relative ability. The subjects were then given the option of playing (or not) a sequence of lotteries where the probabilities of winning were high for people of above-average ability and low for those of below-average ability. The pay-offs were such that risk-neutral people with above-average ability would always play the lottery, whilst below average ones wouldn't.
This experiment revealed several curious things:
1. On average, people's self-confidence is biased. High ability people had less confidence than they should, whilst low ability ones had more.
2. People update their self-confidence too slowly. In theory, someone who lost lotteries should have revised down their estimation of their ability, and those who won should have revised up their estimates. They did so, but much more slowly than Bayes' rule warranted.  So high-ability people searched less, and low ability ones more, than they should.
3. Women were less self-confident than men.
4. People who believe they have low ability don't want to find out the truth about their ability.
These findings have obvious real world explanations. They explain why ugly men chat up (search for) beautiful women - they're over-confident - and continue to do so even after persistent knock-backs;  they don't update beliefs properly. They explain why high-ability people  - especially women - sometimes  don't get the jobs they deserve; they just don't have the confidence to search. And they explain why the unemployed stop looking for work - they don't want to be knocked back.
I suspect we've known all this all along. But we now have objective empirical evidence to corroborate our view that search markets - the labour market or the dating market (analytically these are very similar) - can be systematically inefficient, in that bad matches can occur and good matches don't.
The question is: how great are the costs of this?

Comments

[james c]

Perhaps overly confident people jump to conclusions about human behviour on the basis of contrived economics experiments.

[tom s.]

"They explain why high-ability people - especially women - sometimes don't get the jobs they deserve."

- in the spirit of james c., plain ol' discrimination fits the facts too. There are more plausible explanations than there are broad facts to be fit by them - I don't find this one particularly convincing.

[Shuggy]

No, I think there's a lot in this. Obviously discrimination exists but often ugly blokes pull attractive women and the not so bright sail through interviews because of sheer self-confidence and the ownership of thick skins. Another one is music. Mediocre singers and musicians often do better than those with real talent due to a "look at me" attitude that more sensitive musicians often don't possess.

[dsquared]

I think that this is as much the result of a fairly narrow concept of "ability". The ability to get off your arse and do something is an ability. The ability to keep plugging in the face of discouragement is an ability.

[Katherine]

Let us not forget that discrimination and lack of self-confidence can produce a rather nasty feedback loop. If a woman is discriminated against she may be less confident the next time and so on.

[Sam]

1. On average, people's self-confidence is biased. High ability people had less confidence than they should, whilst low ability ones had more.
2. People update their self-confidence too slowly. In theory, someone who lost lotteries should have revised down their estimation of their ability, and those who won should have revised up their estimates. They did so, but much more slowly than Bayes' rule warranted. So high-ability people searched less, and low ability ones more, than they should.

Can one not trivially explain both these points by noticing that in the real world, high-ability people tend to be disproportionately surrounded by other high ability people, and low-ability people also tend to cluster together (whether through employment, social preferences or whatever).

Therefore a high-ability person's prior for the distribution of ability in the general population will tend to be skewed towards the high-ability end, and a low-ability person's prior will tend to be skewed low. One can trivially change the update rate by changing the shape of the prior distribution. In an extreme case, if I know that a coin is unbiased, and am not prepared to consider other alternatives, I could toss 1000 heads in a row and still wouldn't change my opinion.

[Shuggy]

"I think that this is as much the result of a fairly narrow concept of "ability". The ability to get off your arse and do something is an ability. The ability to keep plugging in the face of discouragement is an ability."

dsquared - agree to a point. People, for example, resent Madonna's success 'cos she cannae sing. I don't. Her ability to promote herself is, as you say, a genuine ability. But the point is, this isn't a *musical* ability.

[Planeshift]

"why the unemployed stop looking for work - they don't want to be knocked back."

And this has particular policy implications, as it shows how constant demonisation ("get a job you lazy layabouts") and patronising courses put on by the job centre won't work.

[Maynard Handley]

"They explain why ugly men chat up (search for) beautiful women - they're over-confident - and continue to do so even after persistent knock-backs; they don't update beliefs properly. "

You've brought up this point before, and I'm not sure I buy the implicit premise. Specifically, your assumption is that
(a) boys want pretty girls and
(b) girls want pretty boys.
I think (a) is largely true. (Yeah, the world is a big place, you know ten guys who care only about the size of a woman's heart, blah blah.) I am far less convinced that (b) is true. Of course girls want boys are intelligent, wealthy, kind, have a great sense of humor, can cook, are artistic, can win triathlons, etc, etc, and, by the way, are also attractive. But in the real world, they don't get someone with all those qualities, so they have to compromise between them. My experience is certainly that if other qualities like kindness and intelligence and a sense of humor are high, they can be substantially more flexible on appearance than guys in a similar situation.

Now none of this denies your points. It may be that, even when "ugly men" is replaced by "men who are pricks", what you are saying holds true. But I'd have to see it scientifically tested to believe it. We can all see whether guys chatting up girls are ugly; what we can't see so easily is whether they have decent personalities or not.

The fact that Kevin Federline (who appears to possess neither looks nor personality) was able to seduce Britney Spears
(a) is merely one anecdote, and may be completely unrepresentative and
(b) may provide us with simply one more piece of evidence of the way that drugs and alcohol can *severely* imapir judgement and
(c) may indicate that Ms Spears, in spite of her looks, is not quite as desirable a catch in real life as she appears on TV; that there is a point at which, no matter how pretty a girl may be, in the eyes of a normal male her looks simply cannot fully compensate for her personality.

[Marie-Therese Leukart]

I would like the following information:
1. Name of Author
2. Name of Publication where this article has been published.
3. Details about the experiment conducted.
4. Is the word "Self- confidence" defined in this article? for example differentiated from "Seklf-Efficiacy"?.
5. I am searching for articles that make above distinction, for the Thesis on which I am working on. In addition I need published experiments on this subject.
6. CI am grateful for any help you can give me.

Marie-Therese leukart.

P. S.: I am an American studing in Germany.