Survey evidence on diffusion of interest and information among investors

021Robert J. Shiller, John Pound

Research output: Contribution to journalArticlepeer-review

245 Scopus citations

Abstract

Questionnaire surveys of institutional and individual investors were undertaken to learn about patterns of communications. It was found that direct interpersonal communications are very important in investor decisions. Questions elicited what fraction of investors were unsystematic and allowed themselves to be influenced by word-of-mouth communications or other salient stimuli. Randomly sampled investors were studied as well as investors in stocks whose price had recently increased dramatically. Contagion or epidemic models of financial markets are proposed in which interest in individual stocks is spread by word of mouth. The survey evidence is interpreted as supporting such models.

Original languageEnglish (US)
Pages (from-to)47-66
Number of pages20
JournalJournal of Economic Behavior and Organization
Volume12
Issue number1
DOIs
StatePublished - Aug 1989
Externally publishedYes

ASJC Scopus subject areas

  • Economics and Econometrics
  • Organizational Behavior and Human Resource Management

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