We study how uniformed traders (defined as strategic traders not endowed with private information) use public disclosure and prices to form beliefs and trade. We manipulate the availability of public forecasts (e.g. earnings forecasts) of forthcoming public signals (e.g., earnings...

When information asymmetry is a major market friction, earnings forecasts can lead to higher price efficiency even after the information in forecasts completely dissipates upon earnings realizations. We show this in an experimental market that features information asymmetry (i.e., some traders...

In this study, we study information processing by financial professionals benchmarked with non-professionals and how correlation among individual forecasts explains the group level forecast performance. In an experiment in which participants make price forecasts based on common financial...