EconPapers    
Economics at your fingertips  
 

Unleashing Animal Spirits - Self-Control and Overpricing in Experimental Asset Markets

Martin Kocher, Konstantin Lucks and David Schindler
Additional contact information
Konstantin Lucks: LMU Munich

No 81, Rationality and Competition Discussion Paper Series from CRC TRR 190 Rationality and Competition

Abstract: One explanation for overpricing on asset markets is a lack of traders\' self-control. Self-control is the individual capacity to override or inhibit undesired impulses that may drive prices. We implement the first experiment to address the causal relationship between self-control abilities and systematic overpricing on financial markets. Our setup can detect some of the channels through which individual self-control restrictions could transmit into irrational exuberance in markets. Our data indicate a large direct effect of restricted self-control abilities on market overpricing. Low self-control traders report stronger emotions after the market.

Keywords: behavioral finance; trader behavior; self-control; experimental asset markets; overpricing (search for similar items in EconPapers)
JEL-codes: D53 D84 G02 G11 G12 (search for similar items in EconPapers)
Date: 2018-03-12
New Economics Papers: this item is included in nep-exp
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
https://rationality-and-competition.de/wp-content/ ... cussion_paper/81.pdf (application/pdf)

Related works:
Journal Article: Unleashing Animal Spirits: Self-Control and Overpricing in Experimental Asset Markets (2019) Downloads
Working Paper: Unleashing Animal Spirits - Self-Control and Overpricing in Experimental Asset Markets (2016) Downloads
Working Paper: Unleashing Animal Spirits - Self-Control and Overpricing in Experimental Asset Markets (2016) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rco:dpaper:81

Access Statistics for this paper

More papers in Rationality and Competition Discussion Paper Series from CRC TRR 190 Rationality and Competition
Bibliographic data for series maintained by Viviana Lalli (info@rationality-and-competition.de).

 
Page updated 2025-03-31
Handle: RePEc:rco:dpaper:81