Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/93910
Authors: 
Grebe, Tim
Schmid, Julia
Stiehler, Andreas
Year of Publication: 
2006
Series/Report no.: 
SFB/TR 15 Discussion Paper 180
Abstract: 
In an information cascade experiment participants are confronted with artificial predecessors predicting in line with the BHW model (Bikchandani et al., 1992). Using the BDM (Becker et al., 1964) mechanism we study participants' probability perceptions based on maximum prices for participating in the prediction game. We find increasing maximum prices the more coinciding predictions of predecessors are observed, regardless of whether additional information is revealed by these predictions. Individual price patterns of more than two thirds of the participants indicate that cascade behavior of predecessors is not recognized.
Subjects: 
information cascades
Bayes' Rule
decision under risk and uncertainty
experimental economics
JEL: 
C91
D81
D82
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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