Journal of Economic Perspectives
ISSN 0895-3309 (Print) | ISSN 1944-7965 (Online)
The Efficient Market Hypothesis and Its Critics
Journal of Economic Perspectives
vol. 17,
no. 1, Winter 2003
(pp. 59–82)
(Complimentary)
Abstract
Revolutions often spawn counterrevolutions and the efficient market hypothesis in finance is no exception. The intellectual dominance of the efficient-market revolution has more been challenged by economists who stress psychological and behaviorial elements of stock-price determination and by econometricians who argue that stock returns are, to a considerable extent, predictable. This survey examines the attacks on the efficient market hypothesis and the relationship between predictability and efficiency. I conclude that our stock markets are more efficient and less predictable than many recent academic papers would have us believe.Citation
Malkiel, Burton, G. 2003. "The Efficient Market Hypothesis and Its Critics ." Journal of Economic Perspectives, 17 (1): 59–82. DOI: 10.1257/089533003321164958JEL Classification
- G14 Information and Market Efficiency; Event Studies; Insider Trading
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