Quotation Huber, Christoph, Bindra, Parampreet Christopher, Kleinlercher, Daniel. 2019. Design-features of bubble-prone experimental asset markets with a constant FV. Journal of the Economic Science Association. 5 197-209.


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Abstract

Experimental asset markets with a constant fundamental value (FV) have grown in importance in recent years. A methodological examination of the robustness of experimental results in such a setting which has been shown to produce bubbles, however, is lacking. In a laboratory experiment with 280 subjects, we investigate whether specific design features are sufficient to influence experimental results. In detail, we (1) vary the visual representation of the price chart, and (2) provide subjects with full information about the FV process. We find overvaluation and bubble formation to be reduced when trading prices are displayed at the upper end of the price chart. Surprisingly, we do not find any effects when subjects have full information about the FV process.

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Publication's profile

Status of publication Published
Affiliation External
Type of publication Journal article
Journal Journal of the Economic Science Association
Language English
Title Design-features of bubble-prone experimental asset markets with a constant FV
Volume 5
Year 2019
Page from 197
Page to 209
Reviewed? Y
URL http://link.springer.com/content/pdf/10.1007/s40881-019-00061-5.pdf
DOI http://dx.doi.org/10.1007/s40881-019-00061-5
Open Access Y
Open Access Link https://doi.org/10.1007/s40881-019-00061-5

Associations

People
Huber, Christoph (Details)
External
Bindra, Parampreet Christopher (University of Innsbruck, Austria)
Kleinlercher, Daniel (University of Innsbruck, Austria)
Organization
Institute for Markets and Strategy IN (Details)
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