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  3. American Economic Review
  4. May 2011
  5. Does Market Experience Eliminate Market Anomalies? The Case of Exogenous Market Experience

Does Market Experience Eliminate Market Anomalies? The Case of Exogenous Market Experience

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Abstract

A vibrant literature has emerged that suggests willingness to pay and willingness to accept measures of value are quite different for inexperienced consumers but that value differences erode with market experience. One potential shortcoming of this literature is that market experience is endogenous. This study presents a framed field experiment that exogenously induces market experience. Empirical findings support the premise that market experience, alone, can eliminate an important market anomaly

Citation

List, John A. 2011. "Does Market Experience Eliminate Market Anomalies? The Case of Exogenous Market Experience." American Economic Review, 101 (3): 313-17. DOI: 10.1257/aer.101.3.313

JEL Classification

  • D12 Consumer Economics: Empirical Analysis
  • D40 Market Structure and Pricing: General