The University of Southampton
University of Southampton Institutional Repository

Financial Markets can go mad : Evidence of irrational behaviour during the South Sea Bubble

Dale, R.S., Johnson, J.E.V. and Tang, L. (2005) Financial Markets can go mad : Evidence of irrational behaviour during the South Sea Bubble The Economic History Review, 58, (2), pp. 233-271. (doi:10.1111/j.1468-0289.2005.00304.x).

Record type: Article

Abstract

This paper explores investor behaviour during the South Sea Bubble—the first major speculative boom and bust on the stock markets. Previous literature debates whether investors during this episode acted rationally. Newly acquired data involving parallel markets for the South Sea Company's stock and subscription receipts are analysed, and widening valuation gaps are observed between these substitutable financial instruments. Rational explanations do not prove adequate, and the anomalies are explained by the biased decision-making of investors, and their tendency to view financial markets as wagering markets. The implications of these findings for the current debate on rationality in financial markets are identified.

Full text not available from this repository.

More information

Published date: 2005

Identifiers

Local EPrints ID: 35855
URI: http://eprints.soton.ac.uk/id/eprint/35855
ISSN: 0013-0117
PURE UUID: be211af1-6616-4fe4-95b6-9f2dce5c96ce

Catalogue record

Date deposited: 22 May 2006
Last modified: 17 Jul 2017 15:46

Export record

Altmetrics

Contributors

Author: R.S. Dale
Author: J.E.V. Johnson
Author: L. Tang

University divisions

Download statistics

Downloads from ePrints over the past year. Other digital versions may also be available to download e.g. from the publisher's website.

View more statistics

Atom RSS 1.0 RSS 2.0

Contact ePrints Soton: eprints@soton.ac.uk

ePrints Soton supports OAI 2.0 with a base URL of http://eprints.soton.ac.uk/cgi/oai2

This repository has been built using EPrints software, developed at the University of Southampton, but available to everyone to use.

We use cookies to ensure that we give you the best experience on our website. If you continue without changing your settings, we will assume that you are happy to receive cookies on the University of Southampton website.

×