Can investors with incorrect beliefs survive in financial markets and have a significant impact on asset prices? My paper addresses this issue by analyzing a dynamic general equilibrium asset pricing model with some investors having rational expectations while others having incorrect beliefs concerning the mean growth rate of the economy. In contrast to the existing literature such as Sandroni ...

Theoretical studies have shown that memories last longer if the neural representations are sparse, that is, when each neuron is selective for a small fraction of the events creating the memories. Sparseness reduces both the interference between stored memories and the number of synaptic modifications which are necessary for memory storage. Paradoxically, in cortical areas like the inferotempora...

As the global economy grows, so does demand for energy. Investment in clean energy projects, including geothermal, is increasingly important to help meet these growing needs. Clean projects are also environmental reasons and as part of battle against climate change. Many sources world located developing countries, emerging market economies. Investors countries normally faced with higher risks t...

The opinions expressed are those of the BlackRock Investment Instititute as of August 2011, and may change as subsequent conditions vary. } The emerging markets (EMs) have provided major investment opportunities over the last decade—whether in the equity, fixed income or currency spaces. } The global growth landscape and investment opportunity set have changed significantly in recent years, but...

a r t i c l e i n f o Using high frequency intraday data, this paper investigates the herding behavior of institutional and individual investors in the Taiwan stock market. The study finds evidence of herding by both investors but a stronger herding tendency among institutional than among individual investors. Institutional investors herd more on firms with small capitalizations and lower turno...

A robust finding in the literature is that seasoned equity offerings (SEOs) are followed by negative long-run abnormal returns, which can be seen as evidence of market timing. In this paper I document the cost of market timing, based on the idea that investors view companies with the most negative abnormal returns in the year following a SEO, as most likely to have timed the issue. I find that ...

Do legal rules matter for economic outcomes? Can changing the details of specific laws affect overall institutions in a way that will have a significant short-term impact? Is it particularly effective to change securities law and regulation? For all three questions, a common answer in both economics and law is “no.” The intellectual underpinning for this position is influential work by Ronald C...