Schmidt-Engelbertz, Paul; Vasudevan, Kaushik - 2024
Investor Confidence surveys, which directly elicit details on investors' higher order beliefs about the U.S. stock market. We … into a stock market perceived to be overvalued. To explore the equilibrium implications, we construct a model of level k … by other, less sophisticated investors. The model reveals that speculators' higher order beliefs amplify stock market …