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Concentration and variability of forecasts in artificial investment games: an online experiment on WeChat

Published online by Cambridge University Press:  14 March 2025

Xiu Chen ,
Fuhai Hong  and
Xiaojian Zhao
Xiu Chen*
Affiliation:
Southern University of Science and Technology, Shenzhen, China
Fuhai Hong*
Affiliation:
Department of Economics, Lingnan University, Tuen Mun, Hong Kong
Xiaojian Zhao*
Affiliation:
Monash University, Clayton, Australia Chinese University of Hong Kong (Shenzhen), Shenzhen, China
*
cxiu506@gmail.com
fuhaihong@ln.edu.hk
xjzhao81@gmail.com
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Abstract

This paper is the first to use the WeChat platform, one of the largest social networks, to conduct an online experiment of artificial investment games. We investigate how people’s forecasts about the financial market and investment decisions are shaped by whether they can observe others’ forecasts and whether they engage in public or private investment decisions. We find that with forecast sharing, subjects’ forecasts converge but in different directions across groups; consequently, forecast sharing does not lead to better forecasts nor more individually rational investment decisions. Whether or not subjects engage in public investment decisions does not significantly affect forecasts or investment.

Keywords

ForecastInvestmentOnline experimentWeChat

JEL classification

D84: Expectations • Speculations G11: Portfolio Choice • Investment Decisions C90: General D83: Search • Learning • Information and Knowledge • Communication • Belief • Unawareness
Type
Original Paper
Information
Experimental Economics , Volume 23 , Issue 3 , September 2020 , pp. 815 - 847
Copyright
Copyright © 2019 Economic Science Association

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Footnotes

Electronic supplementary material The online version of this article (https://doi.org/10.1007/s10683-019-09632-z) contains supplementary material, which is available to authorized users.

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