• Dunning-Kruger effect
• evolutionary finace
• market selection

The dissertation models the behavior of an agent influenced by the "Dunning-Kruger effect" analytically and in line with Evolutionary finance. It also analyzes, mainly through simulations, when the agent is selected by the market in the long run, with a specific focus on situations where the agent is competing against a Bayesian in both correctly and incorrectly specified learning problems. The main result is that in incorrectly specified learning problems there are a multitude of situations where the market selects the Dunning Kruger agent.