The effects of overconfidence on the medium evaluation process of investment project: Evidence from a process tracing experiment

This paper examines the effects of overconfidence on the medium evaluation process of investment project by a process tracing experiment. The results show that: overconfident has no significant effect on the quantity of browsed information and the content of the information that concerned, but affect the time used to browse the information, the extend and the direction were moderated by the investment performance after one phrase. The overconfident participants have higher evaluation of the investment project than rational ones, but there is no significant difference in the final evaluation. The overconfidence are more inclined to maintain the original evaluation than that of rational ones. When the investment performance is vague, there is significant difference in the final decision between the overconfidence who overestimated the investment income and the rational ones, less overconfident ones abandon the investment project.