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Game theoretic illustration of speculative bubbles

4 pointsby IncidentalEconalmost 16 years ago

1 comment

proemethalmost 16 years ago
This article suggest speculation can be seen as a constant-sum game, similar to a poker game. People know the only money they make is at the expense of someone else. People who enter the market as investors (as opposed to speculators) get thus ripped off by speculators, because they don't always know they are taking part to the game.