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Let's chat... When communication promotes efficiency in experimental asset markets: A Review

Abstract : The growing prevalence of stock market chat rooms and social media suggests communication between traders may affect market outcomes. Using data from a series of laboratory experiments, we study the causal effect of trader communication on the price efficiency of markets. We show that communication allows markets to convey private information more effectively. This effect is most pronounced when the communication platform publicizes a reputation score that might identify a person as not being truthful. This illustrates the need for market designers to consider social interactions when designing market institutions to leverage the social motives that foster information aggregation. Abstract The growing prevalence of stock market chat rooms and social media suggests communication
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https://halshs.archives-ouvertes.fr/halshs-02509127
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Submitted on : Monday, March 16, 2020 - 2:58:24 PM
Last modification on : Thursday, April 30, 2020 - 3:12:06 PM
Long-term archiving on: : Wednesday, June 17, 2020 - 2:27:02 PM

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  • HAL Id : halshs-02509127, version 1

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Brice Corgnet, Mark Desantis, David Porter. Let's chat... When communication promotes efficiency in experimental asset markets: A Review. 2020. ⟨halshs-02509127⟩

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