Published August 15, 2017
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Expectations and Learning in Iowa
- Creators
- Bondarenko, Oleg
-
Bossaerts, Peter
Abstract
We study the rationality of learning and the biases in expectations in the Iowa Experimental Markets. Using novel tests developed in Bossaerts [1996], learning in the Iowa winner-take-all markets is found to be in accordance with the rules of conditional probability (Bayes' law). Hence, participants correctly update their beliefs using the available information. There is evidence, however, that beliefs do not satisfy the restrictions of rational expectations that they reflect the factual distribution of outcomes.
Additional Information
We thank Tom Rietz for sending us price and volume series from the Iowa; Experimental Market. Published as Bondarenko, O., & Bossaerts, P. (2000). Expectations and learning in Iowa. Journal of Banking & Finance, 24(9), 1535-1555.Attached Files
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Additional details
- Eprint ID
- 80433
- Resolver ID
- CaltechAUTHORS:20170815-145720985
- Created
-
2017-08-15Created from EPrint's datestamp field
- Updated
-
2019-10-03Created from EPrint's last_modified field
- Caltech groups
- Social Science Working Papers
- Series Name
- Social Science Working Paper
- Series Volume or Issue Number
- 989