TY - JOUR AU - Shiller,Robert J. AU - Pound,John TI - Survey Evidence on Diffusion of Investment Among Institutional Investors JF - National Bureau of Economic Research Working Paper Series VL - No. 1851 PY - 1986 Y2 - March 1986 DO - 10.3386/w1851 UR - http://www.nber.org/papers/w1851 L1 - http://www.nber.org/papers/w1851.pdf N1 - Author contact info: Robert J. Shiller Yale University, Cowles Foundation Box 208281 30 Hillhouse Avenue New Haven, CT 06520-8281 Tel: 203/432-3708 Fax: 203/432-6167 E-Mail: robert.shiller@yale.edu John C. Pound AB - Contagion or epidemic models of financial markets are proposed in which interest in or attention to individual stocks is spread by word of mouth. The models give alternative interpretations of the random walk character of stock prices. A questionnaire survey of institutional investors was undertaken to ascertain the relevance of such models. Questions elicited what fraction of these investors were unsystematic and allowed themselves to be influenced by word-of-mouth communications or other salient stimuli. Rough indications of the infection rate and removal rate were produced. Investors in stocks whose price had recently increased dramatically to a high P/E ratio were contrasted with a control group of investors. ER -