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Understanding the Plott-Wit-Yang paradox
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SYSNO ASEP 0339602 Document Type J - Journal Article R&D Document Type Journal Article Subsidiary J Ostatní články Title Understanding the Plott-Wit-Yang paradox Author(s) Kálovcová, K. (SK)
Ortmann, Andreas (NHU-C) RIDSource Title CERGE-EI Working Paper Series - ISSN 1211-3298
-, č. 397 (2009), s. 1-15Number of pages 15 s. Publication form www - www Language eng - English Country CZ - Czech Republic Keywords experimental betting markets ; private information ; information aggregation Subject RIV AH - Economics R&D Projects LC542 GA MŠMT - Ministry of Education, Youth and Sports (MEYS) CEZ MSM0021620846 - NHU-C Annotation Plott, Wit & Yang (2003) conduct a betting market experiment and find: First, information was aggregated. This suggests that traders updated their private information based on observed market odds. Second, a model based only on the use of private information seems to fit their data best. The authors call this paradoxical. Because the original data are lost, we replicate their experiment. Our results suggest that the paradox seems due to aggregate rather than individual level data analysis. We analyze the individual level data and explain the paradoxical results reported in Plott et al. (2003). Workplace Economics Institute - CERGE Contact Tomáš Pavela, pavela@cerge-ei.cz, Tel.: 224 005 122 Year of Publishing 2010
Number of the records: 1