What Goes Up Must Come Down? Experimental Evidence on Intuitive Forecasting

Do laboratory subjects correctly perceive the dynamics of a mean-reverting time series? In our experiment, subjects receive historical data and make forecasts at different horizons. The time series process that we use features short-run momentum and long-run partial mean reversion. Half of the subje...

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Bibliographic Details
Published in:The American economic review 2013-05, Vol.103 (3), p.570-574
Main Authors: Beshears, John, Choi, James J., Fuster, Andreas, Laibson, David, Madrian, Brigitte C.
Format: Article
Language:English
Subjects:
Analytical forecasting
Central banks
Data
Earnings
Economic dynamics
Economic expectations
Economic forecasting
Economic forecasting models
Economic forecasts
Economics
Experiments
Forecasting
Forecasting models
Forecasting standards
Laboratories
Modeling
Rational expectations theory
Risk aversion
Statistical forecasts
STRUCTURAL BEHAVIORAL ECONOMICS
Studies
Time series
Time series forecasting
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