Expectations in Experiments

Florian Wagener

No 13-125/II, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: This discussion paper resulted in a publication in 'Annual Review of Economics' , 2014, 6, 421-443.

The rational expectations hypothesis is one of the cornerstones of current economic theorising. This review discusses a number of experiments that focus on expectation formation by human subjects and analyses the implications for the rational expectations hypothesis. The experiments show that most agents are weakly rational and that their expectations coordinate quickly; but the strong rational expectations hypothesis poorly describes the expectational dynamics and is outperformed by other hypotheses.

Keywords: Rational expectations; expectation formation; laboratory experiments; human subjects (search for similar items in EconPapers)
JEL-codes: D84 (search for similar items in EconPapers)
Date: 2013-08-29
New Economics Papers: this item is included in nep-exp and nep-hpe
References: Add references at CitEc
Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Expectations in Experiments (2014)
Working Paper: Expectations in Experiments (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20130125

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