Keywords
speculative behavior, neighborhood effects, social interaction, lottery, skewness preference
Abstract
Speculative behavior plays a key role in numerous markets, but little is known about its causes. We test for neighborhood effects on speculative behavior using daily lottery sales data from 20 states in the U.S. In a sample of 160,000 retailers, lottery sales in a census block increase by $0.26, on average, for each $1 increase in neighboring blocks. We test whether this correlation is attributable to contextual effects, correlated effects, or endogenous effects. Our analysis suggests that social interaction is an important cause of speculative behavior.
Original Publication Citation
Neighborhood Effects and Speculative Behavior (with Todd Mitton and Keith Vorkink), Journal of Economic Behavior and Organization, 2018.
BYU ScholarsArchive Citation
Mitton, Todd; Vorkink, Keith; and Wright, Ian, "Neighborhood Effects on Speculative Behavior" (2018). Faculty Publications. 8966.
https://scholarsarchive.byu.edu/facpub/8966
Document Type
Peer-Reviewed Article
Publication Date
2018
Publisher
Journal of Economic Behavior and Organization
Language
English
College
Marriott School of Business
Department
Finance
Copyright Status
© 2018 Elsevier B.V. All rights reserved.
Copyright Use Information
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