Do traders overweight experience from first movers?

Naomi Boyd and Shenru Li

Journal of Financial Research, 2025, vol. 48, issue 2, 905-922

Abstract: We examine empirically how trading by peers on a new platform influences others' adoption decisions. We model the adoption process and find the relation to be U‐shaped, with first movers greatly discouraging their peers from adoption and late movers slightly discouraging or encouraging their peers. Further analysis shows that the U‐shape is explained by social transmission bias rather than profitability.

Date: 2025
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https://doi.org/10.1111/jfir.12427

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