Information Dissemination on Asset Markets with Endogenous and Exogenous Information: An Experimental Approacha

Dennis Alexis Valin Dittrich () and Boris Maciejovsky ()

Papers on Strategic Interaction from Max Planck Institute of Economics, Strategic Interaction Group

Abstract: In this paper we study information revelation on asset markets with endogenous and exogenous information. Our results indicate that superior information can only be exploited in the beginning of trading. Information disseminates on the market and informational advantages are counter-balanced over time. This result holds true for both, exogenous and precise endogenous information. Vague endogenous information, however, has no impact on individual payo. Furthermore, we find that excessive trading decreases individual earnings.

Keywords: Financial markets; Insider trading; Long-lived assets; Experimental economics (search for similar items in EconPapers)
JEL-codes: C90 D40 G14 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-exp
Note: The authors acknowledge financial support by the University of Vienna under the project title “600 Jahre Universit¨at Wien”. Thanks are due to Tarek El-Sehity, Eva Hofmann, and Herbert Schwarzenberger, who helped to run the experiment at the University of Vienna. Valuable comments by Werner G¨uth, Hans Haumer, Christian Helmenstein, Erich Kirchler, and Erik Theissen are gratefully acknowledged.
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Persistent link: http://EconPapers.repec.org/RePEc:esi:discus:2002-03

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