Economics Dictionary of Arguments

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Bubble exonomy: A bubble economy is a period of rapid economic growth fueled by speculation and unsustainable asset prices. These prices are inflated far beyond their intrinsic value, leading to an eventual crash and economic downturn. See also Price, Markets.
Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments.

Author Concept Summary/Quotes Sources

Cass R. Sunstein on Bubble Economy - Dictionary of Arguments

I 140
Bubble formation/markets/economy/Sunstein: Bubbles often arise when people do not believe that a stock has great value, but rather when they believe that other people believe this. They are investing with the expectation that the value of the share will rise due to expectations of other market participants. (1)
Prediction markets/Sunstein: can bubbles also arise in information markets? Of course. Investors can move in one direction because they expect other investors to do so.
>Information/Economic Theories
, >Information Markets.
I 141
In the campaign for the 2004 presidential election, there was a rumor about Kerry, which provoked significant swings.(2)

1. See Robert Shiller, Irrational Exuberance, 2d ed. (Princeton, NJ: Princeton University Press, 2005), p. 2.
2. See Erin Jordan, “Iowa Electronic Markets Yield Near-Accurate Result,” Des Moines Register, Nov. 10, 2004, 5B.

Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments
The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition.

Sunstein I
Cass R. Sunstein
Infotopia: How Many Minds Produce Knowledge Oxford 2008

Sunstein II
Cass R. Sunstein
#Republic: Divided Democracy in the Age of Social Media Princeton 2017

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