American Economic Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
Anticipatory Anxiety and Wishful Thinking
American Economic Review
vol. 114,
no. 4, April 2024
(pp. 926–60)
Abstract
Across five experiments (N = 1,714), we test whether people engage in wishful thinking to alleviate anxiety about adverse future outcomes. Participants perform pattern recognition tasks in which some patterns may result in an electric shock or a monetary loss. Diagnostic of wishful thinking, participants are less likely to correctly identify patterns that are associated with a shock or loss. Wishful thinking is more pronounced under more ambiguous signals and only reduced by higher accuracy incentives when participants' cognitive effort reduces ambiguity. Wishful thinking disappears in the domain of monetary gains, indicating that negative emotions are important drivers of the phenomenon.Citation
Engelmann, Jan B., Maël Lebreton, Nahuel A. Salem-Garcia, Peter Schwardmann, and Joël J. van der Weele. 2024. "Anticipatory Anxiety and Wishful Thinking." American Economic Review, 114 (4): 926–60. DOI: 10.1257/aer.20191068Additional Materials
JEL Classification
- C91 Design of Experiments: Laboratory, Individual
- D12 Consumer Economics: Empirical Analysis
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- D91 Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making