Asset-market experiments and spontaneous speculation

Charles A. Holt

Chapter 2 in The Origins and Evolution of Experimental Economics, 2026, pp 19-34 from Edward Elgar Publishing

Abstract: Vernon Smith and coauthors showed that theoretical predictions which work so well in laboratory experiments for non-durable goods are no longer accurate in markets for durable goods. Traders in such asset markets tend to extrapolate price increases, which results in speculative purchases and further price increases in a self-confirming cycle. This chapter summarizes research on asset price bubbles and on associated short-term forecasting behavior.

Keywords: Asset Markets; Price Bubbles; Gender; Speculation; Double Adaptive Expectations (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035356256
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