Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/62743 
Year of Publication: 
2001
Series/Report no.: 
SFB 373 Discussion Paper No. 2001,32
Publisher: 
Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes, Berlin
Abstract: 
Updating behavior in cascade experiments is usually investigated on the basis of urn prediction. But urn predictions alone can only provide a very rough information on individual updating behavior. Therefore, we implement a BDM mechanism. Subjects have to submit maximum prices that they are willing to pay to participate in the prediction game. This enables us to study subjects' probabilty formation less crudely. The results show that in many situations herding occurs in accordance with the standard BHW model but cannot be explained neither by rational Bayesian updating nor by heuristics identi...ed in former cascade experiments.
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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