We investigate the extent to which price deviations from fundamental values in an experimental asset market are due to the uncertainty of subjects regarding others’ rationality. We do so by comparing the price forecasts submitted by subjects in two market environments: (a) all six traders are...

To what extent is the observed mis-pricing in experimental asset markets caused by strategic uncertainty (SU) and by individual bounded rationality (IBR)? We address this question by comparing subjects initial price forecasts in two market environments – one with six human traders, and the...

In this paper individual overconfidence within the context of an experimental asset market is investigated. Overall, 72 participants traded one risky asset on six markets of 12 participants each. The results indicate that individuals were not generally overconfident. Moreover, overconfidence was...

We experimentally examine the effects of price competition in markets for expe-rience goods where sellers can build up reputations for quality. We compare price competition to monopolistic markets and markets where prices are exogenously fixed (somewhere between the endogenous oligopoly and...

In this paper we study information revelation on asset markets with endogenous and exogenous information. Our results indicate that superior information can only be exploited in the beginning of trading. Information disseminates on the market and informational advantages are counter-balanced...

The demonstrated capacity of markets to aggregate information motivates research on alternative institutions designed to do the same task. This study inquires about forms of parimutuel betting systems. Measures of information aggregation for performance evaluation are introduced. Two...

We experimentally examine the effects of flexible and fixed prices in markets for experience goods in which demand is driven by trust. With flexible prices, we observe low prices and high quality in competitive (oligopolistic) markets, and high prices coupled with low quality in non-competitive...