Naive traders and mispricing in prediction markets

DOI10.1016/J.JET.2012.05.020zbMATH Open1247.91079OpenAlexW2153516420MaRDI QIDQ449182FDOQ449182

Authors: Ricardo Serrano-Padial 

Publication date: 12 September 2012

Published in: Journal of Economic Theory (Search for Journal in Brave)

Full work available at URL: https://doi.org/10.1016/j.jet.2012.05.020

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zbMATH Keywords

private informationfavorite-longshot biasdouble auctioncommon valuesnaive tradersprediction markets

Mathematics Subject Classification ID

Auctions, bargaining, bidding and selling, and other market models (91B26)

Cites Work

• On the aggregation of information in competitive markets
• Informed Speculation with Imperfect Competition
• Cursed Equilibrium
• Revisiting games of incomplete information with analogy-based expectations
• Toward a Strategic Foundation for Rational Expectations Equilibrium

Cited In (12)

• Do Markets Favor Agents able to Make Accurate Predictions?
• Bounded rationality, asymmetric information and mispricing in financial markets
• A jump model for fads in asset prices under asymmetric information
• Nonconvex equilibrium prices in prediction markets
• m-Double Poisson Lévy markets
• Price distortions under coarse reasoning with frequent trade
• Memoirs of an indifferent trader: Estimating forecast distributions from prediction markets
• It takes all sorts: a heterogeneous agent explanation for prediction market mispricing
• Speculative overpricing in asset markets with information flows
• Prediction market prices under risk aversion and heterogeneous beliefs
• The wisdom of the crowd and prediction markets
• An experimental analysis of information acquisition in prediction markets

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