Search, Effort, and Locus of Control

We test the hypothesis that locus of control influences search by affecting beliefs about the efficacy of search effort in a laboratory experiment. Consistent with this hypothesis, we find that reservation wages and effort are increasing in the belief that one's efforts influence outcomes when subjects are not told how search effort affects search outcomes but are unrelated to these locus of control beliefs when subjects know the relationship between effort and search outcomes. This difference in the relationship between locus of control and search behavior across treatments cannot be explained by unmeasured skill or effort costs as the search technology and offer distribution do not vary across treatments. Only the scope for locus of control to influence beliefs differs and can explain the observed difference across treatments