EconStor >
Universität des Saarlandes (UdS) >
CSLE - Forschungsstelle zur Ökonomischen Analyse des Rechts, Universität des Saarlandes >
CSLE Discussion Paper Series, CSLE - Center for the Study of Law and Economics, Universität des Saarlandes >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/23043
  

Full metadata record

DC FieldValueLanguage
dc.contributor.authorKirstein, Annetteen_US
dc.contributor.authorKirstein, Rolanden_US
dc.date.accessioned2009-01-29T15:35:56Z-
dc.date.available2009-01-29T15:35:56Z-
dc.date.issued2004en_US
dc.identifier.urihttp://hdl.handle.net/10419/23043-
dc.description.abstractWe have experimentally tested a theory of bounded rational behavior in a "lemon market". It provides an explanation for the observation that real world players successfully conclude transactions when perfect rationality predicts a market collapse. We analyzed two different market designs : complete and partial market collapse. Our empirical observations deviate substantially from these theoretical predictions. In both markets, the participants traded more than theoretically predicted. Thus, the actual outcome is closer to efficiency than the theoretical prediction. Even after 20 repetitions of the first market constellation, the number of transactions did not drop to zero. Our bounded rationality approach to explain these observations starts with the insight that perfect rationality would require the players to perform an infinite number of iterative reasoning steps. Bounded rational players, however, carry out only a limited number of such iterations. We have determined the iteration type of the players independently from their market behavior. A significant correlation exists between iteration types and observed price offers.en_US
dc.language.isoengen_US
dc.relation.ispartofseriesCSLE Discussion Papers 2004-02en_US
dc.subject.jelD8en_US
dc.subject.jelC7en_US
dc.subject.jelB4en_US
dc.subject.ddc330en_US
dc.subject.keywordguessing gamesen_US
dc.subject.keywordbeauty contestsen_US
dc.subject.keywordmarket failureen_US
dc.subject.keywordadverse selectionen_US
dc.subject.keywordlemon problemen_US
dc.subject.keywordregulatory failureen_US
dc.subject.keywordpaternalistic regulationen_US
dc.subject.stwMarktmechanismusen_US
dc.subject.stwAsymmetrische Informationen_US
dc.subject.stwAdverse Selectionen_US
dc.subject.stwBeschränkte Rationalitäten_US
dc.subject.stwSpieltheorieen_US
dc.subject.stwExperimenten_US
dc.titleLess Rationality, More Efficiency: a Laboratory Experiment on "Lemon" Markets.en_US
dc.typeWorking Paperen_US
dc.identifier.ppn383997178en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
dc.identifier.repecRePEc:zbw:csledp:200402-
Appears in Collections:CSLE Discussion Paper Series, CSLE - Center for the Study of Law and Economics, Universität des Saarlandes

Files in This Item:
File Description SizeFormat
2004-02_lemon.pdf476.14 kBAdobe PDF
No. of Downloads: Counter Stats
Show simple item record
Download bibliographical data as: BibTeX

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.