Information Aggregation with Random Ordering: Cascades and Overconfidence
نویسندگان
چکیده
منابع مشابه
Overconfidence and Informational Cascades∗
This paper combines behavioral economics and social learning. Overconfident agents overweigh their private information relative to the public information revealed by the decisions of others. Therefore, when following a herd, they broadcast more of the information available to them. However, overconfidence trades the additional information revealed by overconfident decisions against more informa...
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Rational investors perceive correctly the value of financial information. Investment in information is therefore rewarded with a higher Sharpe ratio. Overconfident investors overstate the quality of their own information, and thus attain a lower Sharpe ratio. We contrast the implications of the two models using a survey of customers of an Italian leading bank with portfolio data and measures of...
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ژورنال
عنوان ژورنال: The Economic Journal
سال: 2002
ISSN: 0013-0133,1468-0297
DOI: 10.1111/1468-0297.00091