Figure 12:

This figure shows the kernel density estimates of the individual-level MSE parameters for each elicitation form separately and jointly. We fix the horizontal axis to be able to compare the densities for the different parameters. We find that the distribution of μ_i,ψ,3, which capture maternal beliefs about the parameter of the interaction term between human capital at birth and investments, is concentrated in small values close to zero. This finding suggests that a Cobb-Douglas specification is a reasonable approximation for maternal beliefs. This finding is true when we consider the data from each elicitation form separately or together. We see that the variation in μ_i,ψ,1 is larger and distributed around 0.2. The MSE μ_i,ψ,2 has the largest variation in our data, and it is distributed – somewhat symmetrically – around 0.3. For both μ_i,ψ,1 and μ_i,ψ,2, the subjective elicitation probability form data has a higher mean than the distribution generated by the data from the age ranges form.