Environment, social and governance (ESG) policies have become important to many investors. We model the interaction between ESG policy proposals and shareholder trading and voting under different sets of preferences, and we test the predictions of our model in a laboratory experiment. In a first...

How does trader overconfidence (judgemental or self-enhancement) affect their performance in asset markets, and overall market quality? Conversely, how does market participation affect traders’ overconfidence? To address such questions, we build a laboratory asset market in which human...

We propose a simple adaptive learning model to study behavior in the call market. The laboratory environment features buyers and sellers who receive a new random value or cost in each period, so they must learn a strategy that maps these random draws into bids or asks. We focus on buyers'...

The authors examine the price and allocation of purchased information and of the underlying asset in eight double-auction asset market experiments. Observed outcomes support fully revealing rational expectations in simple environments in which uninformed traders can easily infer the private...

This paper analyzes seller choices and outcomes in approximately 700 Internet auctions of a relatively homogeneous good. The ‘Buy it Now’ option allows the seller to convert the auction into a posted price market. We use a structural model to control for the conduct of the auction as well as...

The efficiency-enhancing role of the vengeance motive is illustrated in a simple social dilemma game in extensive form. Incorporating behavioral noise and observational noise in random interactions in large groups leads to seven continuous families of (short run) Perfect Bayesian equilibria...