Recent experimental evidence appears to reject simple Nash equilibrium models of bidding behavior in first-price auctions. The author presents a methodological critique of this evidence. Existing tests have concentrated on deviations of subjects from predictions in the message space of the...

We elicit traders' predictions of future price trajectories in repeated experimental markets for a 15-period-lived asset. We find that individuals' beliefs about prices are adaptive, and primarily based on past trends in the current and previous markets in which they have participated. Most...