forecast the future price of a risky asset. The realized prices depend on these expectations. We observe small (6 participants …) and large markets (about 100 participants). In large markets the influence of an individual forecast on the realized price …

Rational Expectations (RE) models have two crucial dimensions: 1) agents correctly forecast future prices given all … paper we consider both forecasting and optimization decisions in an experimental cobweb economy. We report results from four …) they do both and 4) they are paired in teams and one member is assigned the forecasting role while the other is assigned …

Rational Expectations (RE) models have two crucial dimensions: agents correctly forecast future prices given all … we consider both forecasting and optimization decisions in an experimental cobweb economy. We report results from four … both and they are paired in teams and one member is assigned the forecasting role while the other is assigned the …

We explore the consequence of learning to forecast in a very simple environment. Agents have bounded memory and …

(1994) argues that persistent on-converging sequences of rates of participation with permanent forecasting errors occur due … to the non-existence of a prediction model for agents to forecast the attendance appropriately to induce stable rational …

The recent crisis and the following flight to simplicity put most derivative businesses around the world under …