Economics Dictionary of Arguments

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Information, information theory: A character or a character combination contains information when it is clear to the recipient that this character or the character combination appears instead of another possible character or a possible character combination. The supply of possible characters determines to a part the probability of the occurrence of a character from this supply. In addition, the expected probability of the appearance of a character can be increased by already experienced experiences of regularities. The amount of information transmitted by a character depends on the improbability of the occurrence of the character.
Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments.

Author Concept Summary/Quotes Sources

Colin Camerer on Information - Dictionary of Arguments

Surowiecki I 318
Information/Behavior/Stock market/Camerer/Surowiecki: In an experiment at CalTech (1) Colin Camerer shows that investors (here students) can behave against better knowledge in investment markets. Shares in a fictitious company were issued that could be held or traded over 15 periods. In each period, a dividend of $0.24 per share was set, resulting in a dividend of $3.60 (15 x 0.24) if one hold the share.
Surowiecki I 319
With each expired period, the justified price for the share was thus 0.24 dollars lower. Nevertheless, the test persons continued to buy and sell shares at excessive prices. As a justification, they stated that they wanted to take the dividends with them and that they would later resell the stock to a fool, as they observed that other people were behaving in a similar way.
Surowiecki: the students had all the necessary information. That shows how dangerous it is to make decisions dependent on others.
, >Decision theory, >Dependence, >Stock market.

1. Colin F. Camerer, »Taxi Drivers and Beauty Contests«, Engineering & Science 1/1997, p. 17ff.

Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments
The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition.

EconCamerer I
Colin F. Camerer
Behavioral Game Theory: Experiments in Strategic Interaction Princeton 2003

Surowi I
James Surowiecki
Die Weisheit der Vielen: Warum Gruppen klüger sind als Einzelne und wie wir das kollektive Wissen für unser wirtschaftliches, soziales und politisches Handeln nutzen können München 2005

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