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from individual expectations. Subjects have no information about underlying market equilibrium equations, but can learn by … stable treatment, rational expectations (RE) yield a good description of observed aggregate price fluctuations: prices remain …
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We investigate expectation formation in a controlled experimental en-vironment. Subjects are asked to predict the price in a standard asset pricingmodel. They do not have knowledge of the underlying market equilibrium equa-tions, but they know all past realized prices and their own predictions....
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