Al-Ubaydli, Omar and Boettke, Peter (2010): Markets as economizers of information: Field experimental examination of the “Hayek Hypothesis”.
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The work of Friedrich Von Hayek contains several testable predictions about the nature of market processes. Vernon Smith termed the most important one the ‘Hayek hypothesis’: the gains from trade can be realized in the presence of diffuse, decentralized information, and in the absence of price-taking behavior and centralized market direction. Vernon Smith tested this by surveying data on laboratory experimental markets and found strong support. We repeat this exercise using field experimental market data. Using field experiments allows us to test several other predictions. Generally speaking, we find support for Hayek’s theories.
|Item Type:||MPRA Paper|
|Original Title:||Markets as economizers of information: Field experimental examination of the “Hayek Hypothesis”|
|Keywords:||price dynamics; entrepreneurs; field experiment; market process|
|Subjects:||C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C90 - General
D - Microeconomics > D6 - Welfare Economics > D61 - Allocative Efficiency; Cost-Benefit Analysis
D - Microeconomics > D4 - Market Structure and Pricing > D40 - General
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D82 - Asymmetric and Private Information; Mechanism Design
L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior > L26 - Entrepreneurship
D - Microeconomics > D5 - General Equilibrium and Disequilibrium > D51 - Exchange and Production Economies
B - History of Economic Thought, Methodology, and Heterodox Approaches > B5 - Current Heterodox Approaches > B53 - Austrian
|Depositing User:||Omar Al-Ubaydli|
|Date Deposited:||13. Feb 2012 20:50|
|Last Modified:||11. Feb 2013 20:03|
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Markets as economizers of information: Field experimental examination of the “Hayek Hypothesis”. (deposited 27. Dec 2010 11:03)
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