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Diversity in Cognitive Ability Enlarges Mispricing in Experimental Asset Markets

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  • معلومة اضافية
    • Contributors:
      Groupe de Recherche en Droit, Economie et Gestion (GREDEG); Université Nice Sophia Antipolis (1965 - 2019) (UNS)-Centre National de la Recherche Scientifique (CNRS)-Université Côte d'Azur (UniCA); Faculty of Engineering, Information and Systems Tsukuba; Université de Tsukuba = University of Tsukuba; School of political science and economics, Waseda University; Waseda University Tokyo, Japan; CODIREM; ANR-11-FRJA-0002,BECOA,Fondations comportementales et cognitives de la modélisation mutli-agents(2011); ANR-15-ORAR-0004,BEAM,Analyses comportementales et exp?rimentales en macro-finance(2015); ANR-15-IDEX-0001,UCA JEDI,Idex UCA JEDI(2015)
    • بيانات النشر:
      HAL CCSD
    • الموضوع:
      2017
    • Collection:
      HAL Université Côte d'Azur
    • نبذة مختصرة :
      Does diversity of cognitive ability among market participants increase mispricing? Does common knowledge of heterogeneity in relation to cognitive ability of market participants further increase mispricing? We investigated these questions by measuring subjects' cognitive ability and categorizing those above median ability as type `H' and those below median ability as type `L'. We then constructed three market types, each containing six traders: 6H, 6L, and 3H3L. Subjects were informed of their own cognitive type and, depending on the treatment, that of the others in their market. We found that heterogeneous markets (3H3L) generated significantly larger mispricing than homogeneous markets (6H or 6L) regardless of whether subjects were informed about the cognitive type of others in their market. Thus, diversity of cognitive ability among market participants increased mispricing. However, common knowledge of heterogeneity or homogeneity in the market did not have a significant additional effect.
    • Relation:
      halshs-01202088; https://shs.hal.science/halshs-01202088; https://shs.hal.science/halshs-01202088v2/document; https://shs.hal.science/halshs-01202088v2/file/GREDEG-WP-2017-08.pdf
    • Rights:
      info:eu-repo/semantics/OpenAccess
    • الرقم المعرف:
      edsbas.F6CED881