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α: calibrated so average coauthorship-adjusted count equals average raw count
We report the results of an experiment designed to study the effect of individual asset-holdings restrictions on the formation of bubbles and crashes in laboratory asset markets. Bubbles and crashes are a quite robust phenomenon in experimental settings. Motivated by demand-control policies employed in the Chinese real-estate market, we explore the effects of permanent and short-term caps on individual asset holdings. We find that permanent caps greatly reduce positive bubbles, but tend to generate negative bubbles in later periods. Under short-term caps, on the other hand, neither positive nor negative bubbles are observed. Our results indicate that asset-holdings caps can be effective in eliminating bubbles if properly designed.