Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/110964
Authors: 
Ngangoue, Kathleen
Weizsäcker, Georg
Year of Publication: 
2015
Series/Report no.: 
DIW Discussion Papers 1487
Abstract: 
Our market experiment investigates the extent to which traders learn from the price, differentiating between situations where orders are submitted before versus after the price has realized. When market participants have to submit their bids conditional on the price, they show a bias by reacting only to their private information and not to the hypothetical value of the price. In a sequential trading mechanism, where the price is known at the bid submission, bids react to price to an extent that is roughly consistent with the benchmark theory.
Subjects: 
Naive Expectations
Asymmetric Information
Rational Expectations
Sequential Markets
JEL: 
D82
D81
C91
Document Type: 
Working Paper

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