Overconfidence, Trust, and Information-Seeking among Smallholder Farmers: Experimental Evidence from Ethiopia

We investigate the role of overconfidence and trust in farmers' information-seeking behavior using a lab-in-the-field experiment in Ethiopia. Our results show that overconfidence is widespread among farmers in our sample, predicts less information-seeking, and is associated with an efficiency loss. Moreover, we find that farmers tend to seek more information from extension agents than from peer farmers and that information-seeking increases when the source is perceived as more knowledgeable. When aiming to increase the adoption of productivity-enhancing practices, farmers' overconfidence in their own information set and their trust in the quality of information shared should not be overlooked.