Abstract
| Original language | English |
|---|---|
| Title of host publication | Proceedings of the Behavioural Finance and Capital Markets Conference |
| Editors | P Kalev |
| Place of Publication | Adelaide |
| Publisher | University of South Australia |
| Publication status | Published - 2013 |
| Event | Behavioural Finance and Capital Markets Conference - Rockford Hotel, Adelaide, Australia Duration: 1 Aug 2013 → 2 Aug 2013 http://www.unisa.edu.au/research/cafs/events/conferences/ |
Conference
| Conference | Behavioural Finance and Capital Markets Conference |
|---|---|
| Country | Australia |
| City | Adelaide |
| Period | 1/08/13 → 2/08/13 |
| Internet address |
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House money effects in experimental asset markets. / Paul, Debapriya Jojo; Henker, Julia; Owen, Sian.
Proceedings of the Behavioural Finance and Capital Markets Conference. ed. / P Kalev. Adelaide : University of South Australia, 2013.Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › Research › peer-review
TY - GEN
T1 - House money effects in experimental asset markets
AU - Paul, Debapriya Jojo
AU - Henker, Julia
AU - Owen, Sian
PY - 2013
Y1 - 2013
N2 - We investigate whether prices in experimental asset markets behave differently when participants are required to trade over earned wealth compared to unearned wealth.The latter describes the standard practice of endowing participants with cash/assets in experimental asset market studies of bubbles, which may elicit greater-than-normal risk-seeking behaviour, thereby confounding attempts to understand their drivers ormitigators. We take a new methodological approach in the vein of Cherry et al (2002)in seeking to answer this question by requiring participants in one treatment to earn their initial market allocation. We find that bubbles/mispricing occurs with similar frequency, severity, and duration whether trade occurs with earned or unearned wealth. Our results indicate that any confounding effect(s) caused by endowed money in past studies of bubbles is minimal. Consequently, existing methodology in the study of bubbles does not require modification.
AB - We investigate whether prices in experimental asset markets behave differently when participants are required to trade over earned wealth compared to unearned wealth.The latter describes the standard practice of endowing participants with cash/assets in experimental asset market studies of bubbles, which may elicit greater-than-normal risk-seeking behaviour, thereby confounding attempts to understand their drivers ormitigators. We take a new methodological approach in the vein of Cherry et al (2002)in seeking to answer this question by requiring participants in one treatment to earn their initial market allocation. We find that bubbles/mispricing occurs with similar frequency, severity, and duration whether trade occurs with earned or unearned wealth. Our results indicate that any confounding effect(s) caused by endowed money in past studies of bubbles is minimal. Consequently, existing methodology in the study of bubbles does not require modification.
M3 - Conference contribution
BT - Proceedings of the Behavioural Finance and Capital Markets Conference
A2 - Kalev, P
PB - University of South Australia
CY - Adelaide
ER -