Starjournal Quotation Weitzel, Utz, Huber, Christoph, Huber, Jürgen, Kirchler, Michael, Lindner, Florian, Rose, Julia. 2020. Bubbles and Financial Professionals. Review of Financial Studies. 33 2659-2696.




The efficiency of financial markets and their potential to produce bubbles are central topics in academic and professional debates. Yet, little is known about the contribution of financial professionals to price efficiency. We run 116 experimental markets with 412 professionals and 502 students. We find that professional markets with bubble drivers — capital inflows or high initial capital supply — are susceptible to bubbles, although they are more efficient than student markets. In mixed markets with students, bubbles also occur, but professionals act as price stabilizers. We show that heterogeneous price beliefs drive overpricing, especially in bubble-prone market environments.


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Publication's profile

Status of publication Published
Affiliation External
Type of publication Journal article
Journal Review of Financial Studies
Citation Index SSCI
WU Journalrating 2009 A+
Starjournal Y
Language English
Title Bubbles and Financial Professionals
Volume 33
Year 2020
Page from 2659
Page to 2696
Reviewed? Y
Open Access Y
Open Access Link


Huber, Christoph (Details)
Huber, Jürgen (University of Innsbruck, Austria)
Kirchler, Michael (University of Innsbruck, Austria)
Lindner, Florian (Max Planck Institute for Research on Collective Goods, Germany)
Rose, Julia (University of Innsbruck, Austria)
Weitzel, Utz (Vrije Universiteit Amsterdam, Netherlands)
Institute for Markets and Strategy IN (Details)
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