Speculating in zero-value assets: The greater fool game experiment

[en] In a pre-registered laboratory asset market study, we investigate dynamics of asset markets with zero (or close to zero) fundamental values. We introduce the “greater fool asset market game” with a zero-value token, whose price doubles in each period. We design several treatments, which differ in terms of whether the fundamental value is zero for sure (Baseline), and whether the very low probability of non-zero fundamentals is known (Risk) or not (Ambiguity). We find that prices in markets with zero fundamental value are clearly above zero. Furthermore, we report that prices in treatment Ambiguity are substantially higher than those in treatments Baseline and Risk. Finally, we show that beliefs regarding the asset’s value and others’ participation explain individual market participation.

Disciplines :

Finance

Author, co-author :

Holzknecht, Armando

Huber, Jürgen

Kirchler, Michael

NEUGEBAUER, Tibor ; University of Luxembourg > Faculty of Law, Economics and Finance (FDEF) > Department of Finance (DF)

External co-authors :

yes

Language :

English

Title :

Speculating in zero-value assets: The greater fool game experiment

Publication date :

October 2025

Journal title :

European Economic Review

ISSN :

0014-2921

eISSN :

1873-572X

Publisher :

Elsevier BV

Volume :

180

Pages :

105180

Peer reviewed :

Peer Reviewed verified by ORBi

Focus Area :

Finance

Additional URL :

https://api.elsevier.com/content/article/PII:S0014292125002302?httpAccept=text/xml

Funders :

National Research Fund
Austrian Science Fund

Funding number :

11585355; 16991801

Available on ORBilu :

since 21 October 2025

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