While the impact of social media on financial markets has long been an area of interest for researchers, regulators, and practitioners, the WallStreetBets (WSB) phenomenon - and the sensational short squeeze of Gamestop in 2021 in particular - are widely viewed as having set a new precedent. WSB has demonstrated the potentially dramatic influence of collective retail behaviour on financial markets, amplifying concerns about social media’s potentially harmful effects on investors and efficient market function.

The paper below explores the unique features of WSB...