Price bubbles, gender, and expectations in experimental asset markets
Charles Holt (),
Megan Porzio and
Michelle Yingze Song
European Economic Review, 2017, vol. 100, issue C, 72-94
This paper reports results of laboratory markets for a risky asset with a “flat” fundamental value that equates expected dividends to the return on a safe asset. Subjects were sorted by gender in an unobtrusive manner, and bubbles in this setting are pervasive and of comparable magnitude for both genders. In contrast, a robustness check done with a declining fundamental value did generate larger bubbles for groups of males. Elicited price forecasts tend to trail share prices as they rise and exceed prices as they fall, a pattern that is tracked by a “double adaptive” forecasting model.
Keywords: Price bubbles; Gender; Asset markets; Forecasting; Adaptive expectations; Risk aversion; Cognitive abilities; Laboratory experiments (search for similar items in EconPapers)
JEL-codes: C92 D81 D84 G02 J16 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:100:y:2017:i:c:p:72-94
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