Daniels, Brian P. and Plott, Charles R. (1988) Inflation and Expectations in Experimental Markets. In: Bounded Rational Behavior in Experimental Games and Markets. Lecture notes in economics and mathematical systems. No.314. Springer-Verlag , Berlin, pp. 198-218. ISBN 978-3-642-48356-1. https://resolver.caltech.edu/CaltechAUTHORS:20140311-133427669
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Abstract
A total of nine experimental markets were studied. Seven of these involved eleven or twelve periods of inflation at a constant percentage and then two or three periods of no inflation. Two Experiments involved no inflation for twelve periods and then inflation at a constant rate for three periods. In all but three markets, participants were asked to guess the mean price of the upcoming market period before they had any information about the parameters for that period. The subject with the best guess was given a financial reward in addition to any profit earned in the market. Convergence properties are compared. Rational expectations models are tested and the structure of forecasts are studied. In general, the rational expectations models capture much of what is observed but paradoxes exist in the data and in the application of the models.
| Item Type: | Book Section | ||||||
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| Additional Information: | © 1988 Springer-Verlag. The financial support of the National Science Foundation and the Caltech Program of Enterprise and Public Policy is gratefully acknowledged. The authors also wish to thank David Grether, Kemal Guler, Jeffrey Dubin, Thomas Saving, and Edward Zanelli. | ||||||
| Group: | Social Science Working Papers | ||||||
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| Series Name: | Lecture notes in economics and mathematical systems | ||||||
| Issue or Number: | 314 | ||||||
| Record Number: | CaltechAUTHORS:20140311-133427669 | ||||||
| Persistent URL: | https://resolver.caltech.edu/CaltechAUTHORS:20140311-133427669 | ||||||
| Usage Policy: | No commercial reproduction, distribution, display or performance rights in this work are provided. | ||||||
| ID Code: | 44251 | ||||||
| Collection: | CaltechAUTHORS | ||||||
| Deposited By: | INVALID USER | ||||||
| Deposited On: | 20 Mar 2014 21:00 | ||||||
| Last Modified: | 03 Oct 2019 06:15 |
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