Rational individuals become excessively pessimistic

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Q. Shiller argues which herd behaviour can go both ways: It explains the housing bubble but it also explains the bust. As he notes, "Rational individuals become excessively pessimistic as they see others bidding down home prices to abnormally low levels." Do you agree with Shiller?

Explain how might organizations combat the problems resulting from herd behaviour?

Reference no: EM1387087

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