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dc.contributor.authorFellner, Gerlindeen_US
dc.contributor.authorTheissen, Eriken_US
dc.description.abstractThe overvaluation hypothesis (Miller 1977) predicts that a) stocks are overvalued in the presence of short selling restrictions and that b) the overvaluation increases in the degree of divergence of opinion. We design an experiment that allows us to test these predictions in the laboratory. The results indicate that prices are higher with short selling constraints, but the overvaluation does not increase in the degree of divergence of opinion. We further find that trading volume is lower and bid-ask spreads are higher when short sale restrictions are imposed.en_US
dc.publisherCentre for Financial Research Cologneen_US
dc.relation.ispartofseriesCFR working paper 11-03en_US
dc.subject.keywordovervaluation hypothesisen_US
dc.subject.keywordshort selling constraintsen_US
dc.subject.keyworddivergence of opinionen_US
dc.titleShort sale constraints, divergence of opinion and asset value: Evidence from the laboratoryen_US
dc.typeWorking Paperen_US
Appears in Collections:CFR Working Papers, Centre for Financial Research (CFR), Universität Köln

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