Herd behaviour in financial markets: an experimental approach

Nguyen, Thien Kim (2020) Herd behaviour in financial markets: an experimental approach. PhD thesis, University of Nottingham.

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Abstract

This thesis uses the experimental approach to examine the existence, the characteristics and the consequences of herd behaviour in financial markets. We conduct three experiments, which are asset market (Smith, Suchanek and Williams, 1988), information cascade (Anderson and Holt, 1997) and Holt and Laury (2002). We found that herd behaviour due to information asymmetry and reputation presences in all experimental financial markets. Participants decided to follow the market since they believe other participants have more information, or other participants performed better than themselves. Interestingly, herd behaviour is not a threat for price bubbles, volatility and market efficiency. Individual characteristics and personalities are found to be significantly correlated with herding decisions. The thesis includes four essays, in which each essay presents the results from one of the three experiments. The last essay analyses the impacts of the big five personality traits on investment decisions. The results from this thesis are beneficial for investors, academics and policy-makers.

Item Type: Thesis (University of Nottingham only) (PhD)
Supervisors: Le, Hang
Chmura, Thorsten
Keywords: Investments, Psychological aspects; Decision making, Economic aspects; Herd behaviour
Subjects: H Social sciences > HG Finance
Faculties/Schools: UK Campuses > Faculty of Social Sciences, Law and Education > Nottingham University Business School
Item ID: 59555
Depositing User: Nguyen, Thien
Date Deposited: 21 Jul 2020 04:40
Last Modified: 21 Jul 2020 04:40
URI: http://eprints.nottingham.ac.uk/id/eprint/59555

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