Nils Bedke

Dissertation Topic
Empirical Evaluation of Interest Predictions and Experimental Evidence of Reputational Herding

Brief Description
This dissertation deals with two central questions. It involves an evaluation and analysis of interest predictions of American banks, insurances and other financial service providers. The focus of this analysis covers the (first) question: How good are the interest predictions of financial analysts really?
By using selected statistical instruments it is to be evaluated to what extent the interest predictions fulfil their function of anticipating the future in actual fact and whether the analysts’ expectations of future interest rates can be seen as rational.
The analysis demonstrates that the analysts’ predictions are neither rational nor have a high prognosis quality. Instead of incorporating their personal information on the interest's future development into their predictions, the prognosticators worry about their reputation and thus prefer to remain in the protective surroundings of their herd.
Due to these circumstances a (second) question immediately arises: Can experimental evidence verify this kind of Reputational Herding?

Period of Dissertation
2006 - 2008