Unleashing animal spirits - Self-control and overpricing in experimental asset markets

Kocher, Martin G. ORCID: https://orcid.org/0000-0002-6792-1192, Lucks, Konstantin E. and Schindler, David (2019) Unleashing animal spirits - Self-control and overpricing in experimental asset markets. Review of Financial Studies, 32 (6), pp. 2149-2178.

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Abstract or Table of Contents

One explanation for overpricing on asset markets is a lack of traders’ self-control. We implement the first experiment to address the causal relationship between self-control and systematic overpricing on financial markets. Our setup detects some of the channels through which low individual self-control could transmit into irrational exuberance in markets. Our data indicate a large direct effect of reduced self-control on market overpricing. Low self-control traders report stronger emotions after the market.

Item Type: Article in Academic Journal
Additional Information (public): ebenso: CESifo Working Paper Series No. 5812
Classification Codes (e.g. JEL): G12, G11, D84, D53, G02
Research Units: Insight Austria
Status: Published
Related URLs:
Date Deposited: 25 Sep 2018 08:57
Last Modified: 04 Jun 2019 09:43
URI: https://irihs.ihs.ac.at/id/eprint/4751

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