Online reviews of products, shops, hotels etc. are very common, but are they helpful? Hotels, for example, could receive fictitious negative reviews from neighbouring hotels or they could even give themselves fictitious positive reviews. You can read an interesting piece over at Slate on the economics of internet reviews. Click here for an academic paper which empirically investigates the authenticity of online promotional reviews by comparing reviews on Tripadvisor with those on Expedia.
My colleague and former PhD student Gareth Campbell has created a website about the British Railway Mania - click here . This episode has been described by the Economist as probably the greatest bubble in human history. Gareth's website provides background on the Mania and posits some explanations for the 'bubble'. In his explanation of why the bubble happened, Gareth places a lot of emphasis on investor myopia regarding future dividends and uncalled capital. His study of investors during the episode does not support the view that this episode was fuelled by naive and irrational investors.