Belief Elicitation: Limiting Truth Telling with Information on Incentives
Belief elicitation is central to inference on economic decision making. The recently introduced Binarized Scoring Rule (BSR) is heralded for its robustness to individuals holding risk averse preferences and for its superior performance when eliciting beliefs. Consequently, the BSR has become the state-of-the-art mechanism. We study truth telling under the BSR and examine whether information on the offered incentives improves reports about a known objective prior. We find that transparent information on incentives gives rise to error rates in excess of 40 percent, and that only 15 percent of participants consistently report the truth. False reports are conservative and appear to result from a biased perception of the BSR incentives. While attempts to debias are somewhat successful, the highest degree of truth telling occurs when information on quantitative incentives is withheld. Consistent with incentives driving false reports, we find that slow release of information decreases truth telling. Perversely, our results suggest that information on the BSR incentives substantially distorts reported beliefs.
We are grateful to Yoram Halevy, Paul J. Healy, Steffen Huck, Alex Imas, Dorothea Kübler, Ryan Oprea, Isabel Trevino, and seminar audiences at UCSB and WZB Berlin. We thank Felipe Araujo, Prottoy Akbar, Mallory Avery, Conor Brown, Ying Kai Huang, Matthew Raffensberger, Yuriy Podvysotskiy, and Tianyi Wang for help with the design and implementation of the experiment. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.