Short-selling constraints are common in financial markets, while physical assets such as housing often lack markets for short-selling altogether. As a result, investment decisions are often restricted by such constraints. This paper studies asset prices in behavioural heterogeneous-belief models...

We set out a behavioural model of the stock market in which investors are connected through a social network. Agents may adopt types on the spectrum from pure fundamentalist to arbitrarily strong chartist which they update from their neighbours depending on past performance. Our main analytical...