We develop a methodology to extract a quantitative model for behavioral effects in markets from empirical data. A set of 24 asset market experiments are utilized to derive an equation of price and its dependence on momentum, fundamental value, excess bid level and liquidity considerations. A...

A series of experiments, in which nine participants trade an asset over 15 periods, test the hypothesis that an initial imbalance of asset/cash will influence the trading price over an extended time. Participants know at the outset that the asset or quot;stockquot; pays a single dividend with...

Price volatility and investor overreactions are commonplace in experimental asset markets. Understanding the price dynamics in these markets is crucial for designing successful new trading institutions. We report on a series of experiments to test the predictions of a new momentum model using a...

We report on a large number of laboratory market experiments demonstrating that a market bubble can be reduced under the following conditions: 1) a low initial liquidity level, i.e., less total cash than value of total shares, 2) deferred dividends, and 3) a bid-ask book that is open to traders....

We run a large field experiment with an online company specializing in selling used automobiles via ascending auctions. We manipulate experimentally the “price grid,” or the possible amounts that bidders can bid above the current standing price. Using two diverse auction sites, one in New...

In this paper, we report both field and laboratory experimental results on the effects of setting public versus private reserve prices in ascending auctions. The field experiments were performed with a large online used automobile seller. In addition to providing a check on the results of the...

We experimentally compare under-revelation of supply and demand across alternative variations of ascending and descending two-sided price clock auctions. We find that buyers reduce demand more when the price is ascending but sellers' behavior is consistent across clock directions. As a result,...