This chapter investigates information aggregation when agents face mixed rewards based partly on ex-post realizations (as is typical of prediction markets) and partly on the most popular opinion (as in pure idea markets, or beauty contests). The informational properties of the consensus forecast are characterized when agents trade off the incentive to accurately predict fundamentals with the desire of meeting the most popular opinion.
Modeling idea markets: between beauty contests and prediction markets
OTTAVIANI, MARCO M.;
2011
Abstract
This chapter investigates information aggregation when agents face mixed rewards based partly on ex-post realizations (as is typical of prediction markets) and partly on the most popular opinion (as in pure idea markets, or beauty contests). The informational properties of the consensus forecast are characterized when agents trade off the incentive to accurately predict fundamentals with the desire of meeting the most popular opinion.File in questo prodotto:
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