Description
This study reports the results of 15 experimental asset markets designed to investigate the effects of forecasts on
market prices, traders abilities to assess asset value, and the link between the two. Across the 15 markets, we investigate
alternative forecast-generating processes. In some markets the process produces an unbiased estimate of asset value,
and in others a biased estimate. The processes generating the biased forecasts, though, are less variable than the process
generating the unbiased forecast. We find that, in general, period-end asset price reflects private forecasts, regardless of
the forecast-generating process
doc_697159208.pdf
This study reports the results of 15 experimental asset markets designed to investigate the effects of forecasts on
market prices, traders abilities to assess asset value, and the link between the two. Across the 15 markets, we investigate
alternative forecast-generating processes. In some markets the process produces an unbiased estimate of asset value,
and in others a biased estimate. The processes generating the biased forecasts, though, are less variable than the process
generating the unbiased forecast. We find that, in general, period-end asset price reflects private forecasts, regardless of
the forecast-generating process
doc_697159208.pdf