We explore the effects of competitive incentives and of their time horizon on the evolution of both asset prices and …); ii) a short-term bonus treatment in which bonuses are assigned to the best performers at the end of each trading period …; iii) a long-term bonus treatment in which bonuses are assigned to the best performers at the end of the 15 periods of the …

We develop a parsimonious model of bubbles based on the assumption of imprecisely known market depth. In a speculative … possibility of bubbles depending on the risk-free rate, uncertainty about market depth, and traders’ degree of leverage. This … allows us to discuss several policy measures. Bubbles always reduce aggregate welfare. Among others, certain monetary policy …

We designed a natural-field experiment in the context of local public transportation to test whether rewards in the …

Bubbles in asset markets have been documented in numerous experimental studies. However, all experiments in which … bubbles occur pay dividends after each trading day. In this paper we study whether bubbles can occur in markets without … may have inside information, and (2) the option to communicate with other traders. We find that bubbles can indeed occur …

either liable for losses or not, and when their bonuses are either capped or not. Limited liability introduces a conflict of … limited liability investors contribute to asset price bubbles by increasing liquidity provision and that caps fail to tame … bubbles. Overall, giving investors skin in the game fosters financial stability. …