We conduct a field experiment to see if market liquidity has a causal effect on price efficiency and, if so, why. We … outside our intervention benefit from greater price efficiency. Further results suggest that the improvements in price … efficiency are predominantly due to the price-cues embedded in our quotes, which serve to constrain price inefficiencies, rather …

effects, first-mover advantage, etc.) in a standard information-based herding model. Our results are based on an internet …

predicted by theory, we find that the presence of a flexible market price prevents herding. However, the presence of contrarian …

effects, first-mover advantage, etc.) in a standard information-based herding model. Our results are based on an internet …) in the context of herding.-- information cascades ; herding ; network effects ; experiment ; internet …

cognitive effort required to process the information. We find that subjects’ behavior is largely in line with the predictions …

much with the rationality of choices as with the rationality of the agent as a person. These two claims are buttressed by a … experimental definition of rationality", this new use consists in letting the experiment itself speak of the rationality or … information. We end by reviewing this forgotten experimental avenue not simply historically, but with a view to recommending it …

different market designs, for which perfect rationality implies complete and partial market collapse, respectively. Our … actual outcome is closer to efficiency than expected. Our bounded rationality approach to explaining these observations … starts with the insight that perfect rationality would require the players to perform an infinite number of iterative …

consulting firm, participated in the experiment. As predicted by theory, we find that the presence of a flexible market price …

Markets are increasingly used as information aggregation mechanisms to predict future events. If policy makers make use … policymakers could still benefit from following information contained in market prices. Nonetheless, manipulation is detrimental … often ignore - or even act against - the information revealed in market prices. Finally, mere suspicion of manipulation …

-dependent preferences and prohibit experimenter bias. The effect also shows within-subject in auction experiments: the price that subjects …