When it comes to financial affairs, there are two schools of thought: Traditional financial theory and behavioral finance. Traditional financial theory assumes that people make decisions by gathering ...

Learn how behaviorists explain market inefficiencies through human psychology. Discover key concepts in behavioral economics and finance that challenge rational models.

This is the first in a series called Behavioral Finance and Macroeconomics. The inspiration for this series comes from the unexpectedly positive response the markets and businesses in general have had ...

The author of a paper in a previous issue of Journal of Post Keynesian Economics suggested that developments in behavioral finance might lead Post Keynesian economists to a new "general theory of ...

Robert Shiller, a professor of economics at Yale University, made a prediction in 2005 that a massive bubble was developing in the housing market, and was proved right just two years later, it seemed ...

Discover the base rate fallacy's impact on investing decisions. Learn how overlooking this cognitive bias can lead to financial misjudgments and market misconceptions.

In their paper "Behavioral Finance and Post Keynesian—Institutionalist Theories of Financial Markets," Raines and Leathers discuss how the theories of Keynes, Davidson, and Galbraith could explain ...

Managing money can be a complex and emotional endeavor when it involves our family funds, but when it comes to those of the businesses we run, it is even more complicated. One wrong move and the ...

Investing in the financial markets is a complex endeavor influenced not only by economic factors and market dynamics but also by human behavior. Traditional finance theory assumes that investors make ...

New Year’s is a traditional time to make resolutions and set goals. As behavioral economists know, it is also prime time for hyperbolic discounting. What is hyperbolic discounting? In daily life, it ...