Online Communication and Asset Price Bubbles

Whether Communication can help reduce asset market mispricing or increase mispricing is still an open question. Previous theoretical and empirical study provide mixed evidence on this topic. By using a typical SSW type experimental asset market, we design 2 experimental treatments (Chat vs No_Chat) to investigate the effect of online communication on experimental asset bubbles. Our experimental result shows that the online communication among traders cannot reduce the asset bubbles and even enlarge the level. However, the statistical test show that the difference of bubbles level between Chat treatment and No_Chat treatment is not significant. (c) 2021 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license (https://creativecommons.org/licenses/by-nc-nd/4.0) Peer-review under responsibility of the scientific committee of the International Conference on Identification, Information and Knowledge in the internet of Things, 2020.