Concentration and Unpredictability of Forecasts in Artificial Investment Games
Fuhai Hong and
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Xiu Chen: Department of Economics, Hong Kong University of Science and Technology, Hong Kong
Fuhai Hong: Division of Economics, Nanyang Technological University, 14 Nanyang Drive, Singapore 637332.
No 1608, Economic Growth Centre Working Paper Series from Nanyang Technological University, School of Social Sciences, Economic Growth Centre
This paper investigates how people’s forecasts about financial market are shaped by the environment, in which people interact before making investment decisions. By recruiting 1385 subjects on WeChat, one of the largest social media, we conduct an online experiment of artificial investment games. Our treatments manipulate whether subjects can observe others’ forecasts and whether subjects engage in public or private investment decisions. We find that subjects’ forecasts significantly converge when shared, though in different directions across groups. We also observe a strong positive correlation between forecasts and investments, suggesting that an individual’s reported forecast is associated with his belief.
Keywords: forecast; investment; online experiment (search for similar items in EconPapers)
JEL-codes: C90 D83 D84 G11 (search for similar items in EconPapers)
Pages: 36 pages
New Economics Papers: this item is included in nep-cbe, nep-exp, nep-hpe and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:nan:wpaper:1608
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