The paper investigates the relationship between liquidity and market efficiency in prediction markets, revealing that increased liquidity may not enhance pricing accuracy and can even worsen it due to naive trading behavior.
Flood insurance is more than actuarily fair — it is actually giving away money to homeowners. Yet, 40% of high-risk consumers don’t purchase flood insurance. Why? And what does it mean for optimal policy? 1/ https://t.co/XbWF6vfBTx