Science
Economists examine how people infer, revise beliefs in face of new information
Key Points
When people hear something new about a topic, they should update their beliefs to reflect the new information. But many people either underreact or overreact, with their responses varying based on different factors, including the environment. In "The Inference-Forecast Gap in Belief Updating," researchers compared how people make inferences and revise their beliefs in light of the same information.
When people hear something new about a topic, they should update their beliefs to reflect the new information. But many people either underreact or overreact, with their responses varying based on different factors, including the environment. In "The Inference-Forecast Gap in Belief Updating," researchers compared how people make inferences and revise their beliefs in light of the same information.