Self-Evaluation Bias and Social Comparison Motives: A Field Experiment on Social Aspirations

Abstract

Based on a field experiment at Singapore hawker centres, I examined the effect of social comparison information on levels of social aspirations. I built my theoretical argument by integrating self- evaluation bias into the process of forming aspiration levels under the influence of social comparison information. I argue that social comparison information triggers a self-improvement motive for managers underestimating their relative performance, and this motive leads to higher social aspiration levels. However, if managers display overconfident self-evaluations, social comparison information negatively affects social aspirations for them as they are prone to self-enhancement motive. I test my hypothesis in a field experiment setting. I recruited food stall managers from hawker centres in Singapore and randomize them into treatment and control, so I can empirically show the existence of self-evaluation bias held by real business managers and gauge the causal effect of social comparison information on social aspiration levels. The empirical findings support my hypothesis.