Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/107301 
Year of Publication: 
2015
Series/Report no.: 
CESifo Working Paper No. 5162
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We study reputational herding in financial markets in a laboratory experiment. In the spirit of Dasgupta and Prat (2008), career concerns are introduced in a sequential asset market, where wages for investors are set by subjects in the role of employers. Employers can observe investment behavior, but not investors' ability types. Thereby, reputational incentives may arise endogenously. We find that a sizeable fraction of investors follows an established trend even in a setting where there are no reputational incentives. In a setting where there are reputational concerns, they do not seem to create substantial herd behavior.
Subjects: 
reputation
herding
imitation
financial markets
experiment
JEL: 
C91
D80
G14
Document Type: 
Working Paper
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