I just sent off a list of corrections to HarperCollins before the paperback version of Myth goes out for another printing. It's not a very long list: a misplaced apostrophe, a "Buffet" where "Buffett" was intended, and a couple of modest fixes suggested by readers, which I discuss at the end of this post. But this is not the first list of corrections I have sent to my publisher, and it seems long past time that I assembled all the errors in one place.
There were two major waves of typo discovery, one when I got my first copy of the book and discovered a mess of misspellings in the last two pages of the epilogue (which were added after the book had been copy-edited) and another when the copy editor of the English edition read through the book. The substantive errors, on the other hand, came to light in dribs and drabs. Several were pointed out by concerned parties Dick Thaler and Gene Fama; the other corrections all came from careful readers of the book. Here's a rundown:
1. On pages 101 and 102, the original account of the first event-study research, conducted by Fama, Mike Jensen, and Richard Roll, depicted it as mostly Jensen's idea. Fama remembered it differently—and Jensen and Roll said Fama's recollection sounded about right. Here's the new version (Lorie and Fisher were James Lorie and Lawrence Fisher, the driving forces beyond Chicago's Center for Research on Security Prices, or CRSP):
At first Lorie struggled to get scholars interested in using the market data that he and Fisher had collected at CRSP, and asked his Chicago colleagues for help. Fama suggested to Jensen and Roll that they use the database to test how quickly the market reacted to new information. Together with Fisher, the trio examined price movements before and after stock split announcements.
2. On page 186, I wrote that Dick Thaler had been denied tenure at the University of Rochester. That wasn't quite right, Thaler informed me. As it now says in the book, "He tried to leverage a job offer from Cornell University into a promotion to associate professor at Rochester but was turned down."
3. On page 187, I had Thaler as a co-founder of the Society for the Advancement of Behavioral Economics. He was involved with group, but wasn't a co-founder.
4. On page 190, I wrote that when Charlie Plott had asked Gene Fama for advice in the late 1970s in testing the efficient market hypothesis in an efficient market, Fama had replied that his theory "only applies to the U.S. stock market." Fama wrote me to say that, while he didn't remember what exactly he said to Plott, it couldn't have been those words, because he'd already published papers on the efficiency of markets other than the U.S. stock market. Plott figured Fama must be right about that, so we came up with a redo that was somewhat less dependent on purported dialogue from three decades ago:
"He said his theory has nothing to do with experiments," Plott recalled—it applied only to markets in the field. "But aren't the principles of economics general enough to apply to both situations?" Plott remembers wondering. Fama's take, decades later: "Experimental research is no substitute for empirical work on real market data."
5. On page 201 I said the two papers from the behavioral finance session at the 1984 American Finance Association meeting that were subsequently published in the Journal of Finance had both been previously rejected by academic journals. That wasn't true of Thaler and Werner De Bondt's paper on market overreaction (it had never been submitted anywhere), so I deleted that assertion.
6. On p. 319, I mistranscribed a quote from John Maynard Keynes. The corrected quote:
The right remedy for the trade cycle is not to be found in abolishing booms and thus keeping us permanently in a semi-slump; but in abolishing slumps and thus keeping us permanently in a quasi-boom.
Some of these errors were fixed in time for subsequent hardcover printings of the book; all were fixed in time for the paperback. But the e-mails from readers keep trickling in.
The most substantial error discovered since the paperback release has to do with Jan Mossin, the Norwegian economist who was one of the several fathers (or at least an uncle) of the Capital Asset Pricing Model. I identified him on page 88 as affiliated with the University of Bergen; in fact, he taught at NHH, which is rendered in English as either the Norwegian School of the Economics or the Norwegian School of Economics and Business Administration. It is near Bergen, but it's separate from the University of Bergen. The next paperback printing will also mention, if there's space, that Mossin got his Ph.D at Carnegie Tech. This seemed relevant given the school's role elsewhere in my book. The definitive online biography of Mossin, in case you're curious, is here.
Also, on page 242, I referred to NYSE specialists and Nasdaq market makers on second reference as "brokers." A reader suggested that wasn't quite right, so I'm changing it to "securities firms."
Got anything else for me?