Graduation Year

2012

Document Type

Dissertation

Degree

Ph.D.

Degree Granting Department

Information Systems and Decision Sciences

Major Professor

Rosann W. Collins

Co-Major Professor

Donald J. Berndt

Keywords

Forms of Capitalism, Prediction Markets (Information Markets), Trader Characteristics, Trader Independence, Trader Participation, Trader Performance

Abstract

There are four main components for influencing traders' behaviors in an information market context: trader characteristics, organizational characteristics, market design, and external information. This dissertation focuses on investigating the impact of individual trader characteristics on trading behaviors. Two newly-developed constructs, highly relevant to information market contexts, were identified to increase our understanding about trading behaviors: trader's economic culture and trader independence. The theory of planned behavior is used as the theoretical basis to postulate hypotheses for empirical testing. Data collected from subjects through a series of web-based experiments shows that trader participation can be fostered through recruiting individuals who are entrepreneurial, risk takers, and not highly independent traders. Additionally, a set of objective measures were developed to operationalize trader participation and performance (accuracy of prediction, and profitability). The research investigation on these concepts suggests that there is statistical evidence for a positive influence of trader participation on trader performance. In comparing the quantity influence (trader participation) and the quality influence (trader accuracy) on trader profitability, we have found that trader accuracy had higher and more significant impact than trader participation.

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