... it follows that competition in financial products is self-regulating. The efficient markets hypothesis is examined, and three approaches to the phenomenon of efficiency distinguished. The idea that the value of a security is independent of the opinion of investors is rejected with reference to the treatment...

.... The fact that, no matter how far prices fall, no private or institutional investor comes forward to buy after panic sets in by itself refutes the efficient markets hypothesis. But there is in fact one other investor who will buy: the government. The financial system, in other words, must look outside...

...This chapter is concerned with the idea of scoring at halftime but with a more scientific perspective. It suggests that what happens at halftime in some soccer games scores big in terms of allowing us to test an influential theory in economics: the efficient-markets hypothesis. The theory posits...

... design MD moral hazard principal agent problem Quiggin J adverse selection game theory rationality Breeden D Lucas R E Milgrom P Stokey N L welfare theorems Biais B Glosten L O’Hara M Spatt C Stiglitz J A Townsend R M noise traders LeRoy S efficient markets hypothesis EMH Pareto...

... regulation, and the financial architecture of the ECB. The ideologies inherent in the New Classical Macroeconomics and the Efficient Markets Hypothesis encouraged the view that people were rational and that markets could successfully self-regulate, thereby downplaying the risks to financial stability...

...Assesses the idea of efficient financial markets. It evaluates the theoretical and empirical foundations of the efficient markets hypothesis, emphasising the cracks that have emerged in them. Special attention is given to the rationality of investors, the randomness of the trades, and the role...

...This chapter explores the culpability of the economics profession in the current global economic crisis. Like the previous chapter, it demonstrates that leading economists pursued a maxi-max decision rule: enamored with the elegance of the efficient markets hypothesis, they advocated a utopian...

... and proofs of all mathematical propositions in the Appendix. behavioural economics and finance efficient markets hypothesis EMH expected utility theory prediction possibility of rational expectations adaptive markets hypothesis AMH Buffett Warren Simons James Adaptive Markets Financial Evolution...

... expectations (Lucas, 1972), the efficient markets hypothesis (EMH) (Samuelson, 1965; Fama, 1970), and behavioural economics and finance (Simon, 1955; Kahneman, Slovic, and Tversky, 1982; Thaler, 1993; Shiller, 2003). While these theories mark important milestones in our understanding of financial markets...