Do anomalies disappear in repeated markets?

Graham Loomes, Chris Starmer, Robert Sugden

Research output: Contribution to journalArticlepeer-review

90 Citations (Scopus)


There is some evidence that, as individuals participate in repeated markets, ‘anomalies’ tend to disappear. One interpretation is that individuals – particularly marginal traders – are learning to act on underlying preferences which satisfy standard assumptions. An alternative interpretation, the ‘shaping’ hypothesis, is that individuals’ preferences are adjusting in response to cues given by market prices. The paper reports an experiment designed to discriminate between these hypotheses with particular reference to the disparity between willingness to pay and willingness to accept.
Original languageEnglish
Pages (from-to)C153-66
JournalThe Economic Journal
Issue number486
Publication statusPublished - 2003

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