Bubbles in hybrid markets: How expectations about algorithmic trading affect human trading

Arbeitspapier

Bubbles are omnipresent in lab experiments with asset markets. But these experiments were (mostly) conducted in environments with only human traders. Today markets are substantially determined by algorithmic traders. Here we use a laboratory experiment to measure human trading behaviour changes if these humans expect algorithmic traders. To disentangle the direct effect algorithmic traders have we use a clean design where we can manipulate only the expectations of human traders. We find clearly smaller bubbles if human traders expect algorithmic traders to be present.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Jena Economic Research Papers ; No. 2015-003

Classification and Topics

• Classification: Wirtschaft ; Design of Experiments: Laboratory, Group Behavior
• Subject: algorithmic traders ; bubbles ; expectations ; experiment

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Farjam, Mike ; Kirchkamp, Oliver
• Event: Veröffentlichung
• (who): Friedrich Schiller University Jena
• (where): Jena
• (when): 2015

Further information

• Handle: http://hdl.handle.net/10419/108549
• Last update: 10.03.2025, 11:44 AM CET