TY  - UNPD
A1  - Caliendo, Marco
A1  - Cobb-Clark, Deborah A.
A1  - Silva-Goncalves, Juliana
A1  - Uhlendorff, Arne
T1  - Locus of control and the preference for agency
T2  - IZA discussion paper
N2  - We conduct a laboratory experiment to study how locus of control operates through people's preferences and beliefs to influence their decisions. Using the principal-agent setting of the delegation game, we test four key channels that conceptually link locus of control to decision-making: (i) preference for agency; (ii) optimism and (iii) confidence regarding the return to effort; and (iv) illusion of control. Knowing the return and cost of stated effort, principals either retain or delegate the right to make an investment decision that generates payoffs for themselves and their agents. Extending the game to the context in which the return to stated effort is unknown allows us to explicitly study the relationship between locus of control and beliefs about the return to effort. We find that internal locus of control is linked to the preference for agency, an effect that is driven by women. We find no evidence that locus of control influences optimism and confidence about the return to stated effort, or that it operates through an illusion of control.
KW  - locus of control
KW  - preference for agency
KW  - decision-making
KW  - beliefs
KW  - optimism
KW  - confidence
KW  - illusion of control
Y1  - 2023
UR  - https://publishup.uni-potsdam.de/frontdoor/index/index/docId/63417
SN  - 2365-9793
VL  - No. 16061
PB  - Elsevier
CY  - Amsterdam
ER  -