Scandinavian Working Papers in Economics

CERE Working Papers,
CERE - the Center for Environmental and Resource Economics

No 2019:10: On extreme perception bias

Imelda Molina (), Emrico Aguilar () and Klarizze Puzon ()
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Imelda Molina: College of Economics and Management, University of the Philippines-Los Banos
Emrico Aguilar: Department of Information and Physical Sciences, Graduate School of Information Science and Technology, Osaka University
Klarizze Puzon: CERE - the Center for Environmental and Resource Economics

Abstract: This preliminary note investigates perception bias: To what extent do individual opinions confound reality? We estimate the relative gap between self-declared estimates and real data. We asked a sample of Philippine respondents about the incidence of diabetes and smartphone usage in their country. We observed a trend of judgement miscalibration. Responses exhibit significant deviation from facts, e.g. inaccuracies can go as high as seven times the real value. Especially for estimates on smartphone ownership, bootstrapped quantile regression models show that perception bias is associated with age.

Keywords: perception; overestimation; quantile regression; bootstrapping

JEL-codes: C81; D91; Z10

12 pages, June 26, 2019

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