Are markets efficient?

Today is a very good excuse to post this video, which I also came upon today, posted on Twitter on the occasion of Richard Thaler winning the Nobel Prize in economics. Thaler and recent Nobelist Eugene Fama have a very pleasant, wide-ranging, and clear discussion about, and debate over, market efficiency.

http://Review.ChicagoBooth.edu | Do market prices generally reflect all available information? Or are they prone to bubbles? On this episode of The Big Question, two members of the Chicago Booth faculty-Nobel laureate Eugene F. Fama and Richard H. Thaler, the father of behavioral economics-discuss how markets behave (and misbehave).

This is also a good excuse to link to an essay on the history of the divergence between experimental and behavioural economics. The differences between the two might seem to be superficial, but they turn out to be fundamental.