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Is more information...
Is more information always better? Experimental financial markets with cumulative information
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- Huber, Jürgen (author)
- Gothenburg University,Göteborgs universitet,Företagsekonomiska institutionen,Department of Business Administration
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Kirchler, Michael, 1977 (author)
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Sutter, Matthias, 1968 (author)
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(creator_code:org_t)
- 2008
- 2008
- English.
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In: Journal of Economic Behavior and Organization. - 0167-2681. ; 65:1, s. 86-104
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https://gup.ub.gu.se...
Abstract
Subject headings
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- We study the value of information in financial markets by asking whether having more information always leads to higher returns. We address this question in an experiment where information about an asset's intrinsic value is cumulatively distributed among traders. We find that only the very best informed traders (i.e., insiders) significantly outperform less informed traders. However, there is a wide range of information levels (from zero information to above average information levels) where additional information does not yield higher returns. The latter result implies that the value of additional information need not be strictly positive.
Subject headings
- SAMHÄLLSVETENSKAP -- Ekonomi och näringsliv -- Nationalekonomi (hsv//swe)
- SOCIAL SCIENCES -- Economics and Business -- Economics (hsv//eng)
Keyword
- Cumulative information; Experimental economics; Value of information
Publication and Content Type
- ref (subject category)
- art (subject category)
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