#SoCaltech: Colin Camerer

“Nearby where I grew up in Timonium, Maryland, there’s a racetrack in the summer that has a state fair and races for one month. I was really fascinated by the idea that 12 horses come on the track, they all look pretty good, they have slightly different things wrapped around their feet, and things like that. Then the crowd somehow decides that horse number three has a 50 percent chance of winning, and horse number seven, who looks very similar—may even be a relative—has a one percent chance of winning.

That’s also a lot like what stock markets do, which is to try to aggregate a lot of messy, often very subjective information, like the future of Tesla, into a single number, which is a price. So, between talking about the stock market and watching markets in action, betting on horses, I really got interested in how do these human beings come together to make these judgments? Are they accurate? Can you beat the market? Can you win betting on horses? No. 

But how does that process work? [As a teenager,] I was kind of laying the groundwork for seeing something live that was fun and wanting to eventually try to figure it out.”

Colin Camerer is the Robert Kirby Professor of Behavioral Economics and the director of the T&C Chen Center for Social and Decision Neuroscience. He will deliver his Watson Lecture, “The Brain Hates Losing (and Other News from Neuroeconomics),” on Wednesday, October 12, 2022, at 7:30 p.m. The lecture can be viewed both online and in person. A recording will be available soon after the lecture’s completion on Caltech’s YouTube channel.

#SoCaltech is an occasional series celebrating the diverse individuals who give Caltech its spirit of excellence, ambition, and ingenuity. Know someone we should profile? Send nominations to magazine@caltech.edu.