Reacting to ambiguous signals in an experimental asset market
Central banks often make public announcements regarding their long-term monetary policy in order to reduce uncertainty in the markets and to stimulate economic activities. Such intention suggests that reducing uncertainty has important implications for economic and financial stability. Our paper aim...
| Main Authors: | , , |
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| Format: | Final Year Project (FYP) |
| Language: | English |
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Nanyang Technological University
2021
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| Subjects: | |
| Online Access: | https://hdl.handle.net/10356/147927 |
| _version_ | 1811678398080090112 |
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| author | Nur Afifah Nasharudin Sun, Kangqing Tan, Mei Qi |
| author2 | Bao Te |
| author_facet | Bao Te Nur Afifah Nasharudin Sun, Kangqing Tan, Mei Qi |
| author_sort | Nur Afifah Nasharudin |
| collection | NTU |
| description | Central banks often make public announcements regarding their long-term monetary policy in order to reduce uncertainty in the markets and to stimulate economic activities. Such intention suggests that reducing uncertainty has important implications for economic and financial stability. Our paper aims to investigate the factors driving market participants’ behaviour under ambiguity that could potentially lead to financial market volatility. Understanding how market participants process ambiguous information and make their decisions could also guide descriptive modelling of decisions under uncertainty and has empirical implications. In an asset market experimental setting, our results provide statistical evidence to information processing when subjected to ambiguous quality of private signals. In particular, Ambiguity-Averse participants tend to over-weight the private signal and ambiguous signals are a source of asset misvaluation. |
| first_indexed | 2024-10-01T02:52:37Z |
| format | Final Year Project (FYP) |
| id | ntu-10356/147927 |
| institution | Nanyang Technological University |
| language | English |
| last_indexed | 2024-10-01T02:52:37Z |
| publishDate | 2021 |
| publisher | Nanyang Technological University |
| record_format | dspace |
| spelling | ntu-10356/1479272023-03-05T15:42:06Z Reacting to ambiguous signals in an experimental asset market Nur Afifah Nasharudin Sun, Kangqing Tan, Mei Qi Bao Te School of Social Sciences baote@ntu.edu.sg Social sciences::Economic theory::Macroeconomics Central banks often make public announcements regarding their long-term monetary policy in order to reduce uncertainty in the markets and to stimulate economic activities. Such intention suggests that reducing uncertainty has important implications for economic and financial stability. Our paper aims to investigate the factors driving market participants’ behaviour under ambiguity that could potentially lead to financial market volatility. Understanding how market participants process ambiguous information and make their decisions could also guide descriptive modelling of decisions under uncertainty and has empirical implications. In an asset market experimental setting, our results provide statistical evidence to information processing when subjected to ambiguous quality of private signals. In particular, Ambiguity-Averse participants tend to over-weight the private signal and ambiguous signals are a source of asset misvaluation. Bachelor of Arts in Economics 2021-04-20T06:51:58Z 2021-04-20T06:51:58Z 2021 Final Year Project (FYP) Nur Afifah Nasharudin, Sun, K. & Tan, M. Q. (2021). Reacting to ambiguous signals in an experimental asset market. Final Year Project (FYP), Nanyang Technological University, Singapore. https://hdl.handle.net/10356/147927 https://hdl.handle.net/10356/147927 en application/pdf Nanyang Technological University |
| spellingShingle | Social sciences::Economic theory::Macroeconomics Nur Afifah Nasharudin Sun, Kangqing Tan, Mei Qi Reacting to ambiguous signals in an experimental asset market |
| title | Reacting to ambiguous signals in an experimental asset market |
| title_full | Reacting to ambiguous signals in an experimental asset market |
| title_fullStr | Reacting to ambiguous signals in an experimental asset market |
| title_full_unstemmed | Reacting to ambiguous signals in an experimental asset market |
| title_short | Reacting to ambiguous signals in an experimental asset market |
| title_sort | reacting to ambiguous signals in an experimental asset market |
| topic | Social sciences::Economic theory::Macroeconomics |
| url | https://hdl.handle.net/10356/147927 |
| work_keys_str_mv | AT nurafifahnasharudin reactingtoambiguoussignalsinanexperimentalassetmarket AT sunkangqing reactingtoambiguoussignalsinanexperimentalassetmarket AT tanmeiqi reactingtoambiguoussignalsinanexperimentalassetmarket |