Replication data for: Hindsight, Foresight, and Insight: An Experimental Study of a Small-Market Investment Game with Common and Private Values

Name: Replication data for: Hindsight, Foresight, and Insight: An Experimental Study of a Small-Market Investment Game with Common and Private Values
Published: 2009-09-01
License: This work is licensed under an Other license created by the data depositor. Please refer to the LICENSE file, which should be located alongside the project data and documentation.
Keywords: investment with endogenous timing

Principal Investigator(s): View help for Principal Investigator(s) Asen Ivanov; Dan Levin; James Peck

Version: View help for Version V1

Name	File Type	Size	Last Modified
20070475R1_Data_AddMaterials			10/20/2021 12:46:PM
LICENSE.txt	text/plain	14.6 KB	10/12/2019 05:49:AM

Project Citation:

Ivanov, Asen, Levin, Dan, and Peck, James. Replication data for: Hindsight, Foresight, and Insight: An Experimental Study of a Small-Market Investment Game with Common and Private Values. Nashville, TN: American Economic Association [publisher], 2009. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113322V1

Project Description

Summary: We experimentally test an endogenous-timing investment model in which subjects privately observe their cost of investing and a signal correlated with the common investment return. Subjects overinvest, relative to Nash. We separately consider whether subjects draw inferences, in hindsight, and use foresight to delay profitable investment and learn from market activity. In contrast to Nash, cursed equilibrium, and level-k predictions, behavior hardly changes across our experimental treatments. Maximum likelihood estimates are inconsistent with belief-based theories. We offer an explanation in terms of boundedly rational rules of thumb, based on insights about the game, which provides a better fit than quantal response equilibrium. (JEL C72, D82, D83, G11)

Scope of Project

Subject Terms: investment with endogenous timing

JEL Classification:
      C72 Noncooperative Games
      D82 Asymmetric and Private Information; Mechanism Design
      D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
      G11 Portfolio Choice; Investment Decisions

Data Type(s): experimental data

Methodology

Unit(s) of Observation: individuals,

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Published Versions

V1 [2019-10-12]

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